Would They Do The Same to Nikola?

Recently,  New Jersey voted against Tesla motors.  The corporation does not use retail stores, instead they use direct sales.  Early last week Governor Chris Christie and his council voted against this way of doing business.  Texas and Arizona are the only other states where it is illegal to make direct sales from store purchases.

You would think the Garden State would be more empathetic to the environmentally friendly car company.  Maybe it was all just a trick.  The Tesla company has been in the state for a year and a half and Governor Christie just now decided to vote against continued business in the state.  Based on state laws, Tesla should have never been allowed to open their doors in the first place.

I was told New Jersey was corrupt but I didn’t think it had anything on Illinois until now.  Jim Appleton,  president of the New Jersey Coalition of Automotive Retailers (NJCAR) says that Tesla received two licenses from the New Jersey Motor Vehicle Commission (NJMVC).  A representative from Tesla said that Governor Christie’s administration went back on its word.  The Tesla representatives went on to say, “The Administration has decided to go outside the legislative process by expediting a rule proposal that would completely change the law in New Jersey.  This new rule, if adopted, would curtail Tesla’s sales operations and jeopardize our existing retail licenses in the state.”

People in the retail industry see the dealer concept as being beneficial to commerce.  They feel as though the retail or sales office is the face of the consumer and represents said consumer to the manufacturer.  This type of representation is commonly seen when a consumer makes a claim on the warranty.  The dealer ensures the manufacturer makes good on said warranty.

Most people identify car dealers as con men and for this reason many car makers have attempted to cut out the middle man with little success.  The lack of success has to do with the fact that dealerships are expensive.  Many car makers agreed to franchise dealerships because it is cheaper to run said franchise than it is to pay all of its own employees.

Tesla Motors believes because their vehicle is a new concept.  It is better for them to have direct contact with their consumers.  Tesla also has a stellar track record based on the amount of maintenance required.  They may just be blazing the trail as far as illustrating how obsolete dealers are in today’s economy.

I don’t think Tesla should have received the two licenses from the NJMVC in the first place.  Now, a year and a half later, the state wants to go back and vote banning direct sales which pretty much forces Tesla to conform to the new law.  If I was a Tesla representative, I would have moved out of that state by 1 April, which is when the law comes into effect.  I will grant you that New Jersey is one of the wealthiest states in the union.  It’s still trying to make an economic recovery.  People say the state is a key market for the company, however, as a representative of Tesla I would not be willing to play the games the New Jersey legislation has been playing.  I would take my car and roll out.

Onyx Contributor:  R.L. Knight