Tesla finds way to share the road with Washington State dealers

OLYMPIA, Washington — On President’s Day last month, about 40 electric-car advocates gather under the rotunda of the state capitol in Olympia, Washington, where a lobbyist for Tesla Motors urged them to rally against a bill that would prevent the electric carmaker from opening new showrooms in the state.

By the time the legislature finished its work last week, a coalition of environmentally friendly Democrats and free-market Republicans stripped the restrictions from the bill. Tesla would be free to sell its cars through its own sleek showrooms rather than relying on the dealer networks that have dominated the industry for decades.

It was a welcome win for the startup after setbacks in Arizona, New Jersey and Texas, where state officials blocked the company from selling directly to consumers. But auto dealers were also happy with the bill’s outcome, because it carved an exception for Tesla while strengthening rules that require other automakers to sell through their stores.

The outcome in Washington, which still must be approved by the governor, shows that the batter between the Silicon Valley startup and Main Street dealers, currently playing out in states like New York and Ohio, isn’t necessarily a zero-sum game.

Where there is a ban, Tesla can show off its cars in “galleries” and sell them online. Dealers may also be able to co-exist with Tesla in states where it sells directly, so long as bigger players don’t try to follow its lead.

Tammy Darvish, Vice President of Silver Spring, Maryland-based Darcars Automotive Group:

“Our issue is not with Tesla itself, it’s with the model. How can we as auto dealers compete with manufacturers in the same market when we are completely dependent upon them for our inventories?”

Source: Reuters

 

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