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Motion Denied: Texas Swats Down Tesla's Wish to Sell Directly to Consumers

By Trevor Dorchies | June 04, 2013
Tesla Motors, the all-electric automaker, has lost a legal battle with Texas that started earlier this year. Unfortunately for the Model S-maker, a request to sell directly to consumers was denied by Texas legislators, even after it had success with other states like, Massachusetts, New York, and Minnesota. Texas was up next for Tesla after getting Minnesota to bypass its franchise laws, but unlike the North Star state, the EV automaker wouldn't be as lucky in the Lone Star state. "The Legislature did the right thing," said Karen Phillips, general counsel of the Texas Automobile Dealers Association to Automotive News. The Texas Automobile Dealers Association opposed Tesla's motion to bypass its franchise laws. Tesla CEO Elon Musk and Co. supported bills in Texas that would exempt the EV maker from current state laws that prohibit dealerships. This bill never even saw the light of day in the Texas House or Senate, though. This is bad news for Tesla as the Legislature's normal session concluded on May 27 and isn't expected to convene again until 2015. We reached out to Tesla for a response but the automaker has no comment at this time. Even though Tesla has challenged state franchise laws before, it was most aggressive in Texas, but the end result was not what it was shooting for. Tesla already has locations in Houston and Austin but both stores aren't allowed to sell to the public. The defeat in Texas comes on the heels of being rejected in Virginia after its request for a dealership license was also denied. On top of that, Tesla is currently engaged in a legal battle with North Carolina as it seeks the right to sell its vehicles online. The outcome of these legal proceedings remains uncertain for now, but Musk has said that if he keeps getting turned down on the state level; he will take it to the federal level. What say you? Should Tesla be able to bypass state franchise laws? Sound off in the comment section. Source: Automotive News (subscription required)
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