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Arizona bill would allow Tesla to skip dealers

Published on NewsOK Modified: March 19, 2014 at 5:52 pm •  Published: March 19, 2014

PHOENIX (AP) — Electric car manufacturer Tesla Motors would be allowed to sell cars in Arizona without establishing a dealer network under a bill approved by a state Senate committee Wednesday.

House Bill 2123 is strongly opposed by traditional auto manufacturers and dealers, who argue that Tesla wants to operate outside the normal rules that require manufacturers to sell cars through dealers. They say allowing sales directly from an automaker could leave consumers in the lurch if the company goes belly-up.

"Tesla is asking for a special exemption for them to have a separate set of rules for their electric cars," Mike Gardner, a lobbyist for the Alliance of Automobile Manufacturers, told the Senate Commerce, Energy and Military Committee. "What we're opposed to is allowing one of our competitors to go around the dealer network and sell directly to consumers. We think we should all be treated the same."

But Rep. Warren Petersen, the bill's sponsor, said dealers and manufacturers are trying to stifle innovation.

"This is a great opportunity for us to send a message that we welcome business and we welcome Tesla here to Arizona," said Petersen, R-Gilbert. "We shouldn't deny our consumers from being able to purchase a product if they want."

Tesla Motors Inc. has a showroom in Scottsdale but can't sell cars there under a 2000 law. Instead, it takes orders online.

Arizona is also one of four states vying for a new lithium-ion battery factory that would supply the company's Fremont, Calif., assembly plant. Others are New Mexico, Nevada and Texas. Tesla says it will invest $2 billion in the 10-million-square-foot factory, which will cost between $4 billion and $5 billion.

Despite Arizona being in the running for the plant, lawmakers said the bill was unrelated.

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