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Texas is trying to block Tesla from servicing its cars in direct sales with car dealers



Tesla has long been having trouble selling their cars in Texas because of their direct sales law and car dealership lobbying, but now the automaker's situation has become even more uncertain in the state as a new expense that can block them from even servicing their cars being introduced .

Texas is one of the largest markets in the United States that still prohibits Tesla's direct sales model.

The local car dealer lobby uses old laws to stop automakers from competing with their own franchise dealers to block Tesla from selling their own cars directly to consumers, even though Tesla never had any franchise dealers.

Many see this as a free market question, as car dealers seem to use the law to protect themselves from competition and create a monopoly.

Tesla has launched several lobbying efforts to change the law over the years, but they never managed to convince the legislator, which is affected by the car dealer lobby.

Despite this, Texans has bought thousands of Tesla cars, which the automaker supplies from other states to comply with the law.

Tesla has been able to service these vehicles through its own service centers, which are not subject to the same direct selling rules, but now dealers even deal with Tesla's right to service their cars.

Republican Senator Kelly Hancock introduced a new bill (SB 1

415) that would ban Tesla from servicing its cars through its own service centers if it comes through the legislator.

According to the draft, it would be effective as soon as September 1, 2019.

We contacted Tesla about the situation. A spokesman said they were aware of the bill and they were looking at it.

Here is the fully introduced draft of the bill:

Electrek's Take

Well, Texas's use of direct selling laws was already ridiculously abused, but they are now pushing it to a whole new stupidity level.

If the legislator actually accepts this bill, it would be extremely disappointing from a political point of view and a great success for Tesla himself and Tesla owners in Texas.

Texan EV fans, or free market friends for that matter, should contact their local representatives and tell them how you feel about this ridiculous attempt to abuse the law to give a monopoly to franchise dealers who are afraid of fair competition from Tesla and other companies that want to sell and operate their own vehicles.

While Tesla would be the most affected company at this point, I think other companies like Rivian should join the battle here.

What do you think? Please let us know in the comment section below.


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