80 Dealers Protest Tesla Motors In Connecticut

Tesla Motors is currently in a battle for the legal right to sell directly-to-consumers in Connecticut. That battle has led to the creation of a website expressing opposition to Tesla moving to the Constitution state as well as an outright protest. This move on the part of the dealers and a dealer group to oppose Tesla Motors comes on the heels of similar occurrences in other cities in the U.S. during the past few years.

The protest, which was a planned action on behalf of about 80 dealers, took place at the State Capitol in Hartford. It was an opportunity for dealers to have their voice heard in this ongoing direct-to-consumer sales debate. Tesla Motors may allow a hybrid system in the future that incorporates dealers and their gallery stores, but for now it’s just the gallery store setup, which cuts dealers out of the equation.

James R. Fleming is among those leading the effort on behalf of dealers against Tesla’s desire to sell in Connecticut. Fleming, a former Connecticut State Senator, is now the President of the Connecticut Automotive Retailers Association. In an interview with the Samford Advocate Fleming said, “What happens when there are warrantee, recall or Lemon Law issues, where manufacturers have costs associated with those? In a direct-sales model, under the franchise system, dealers do not have those costs. In fact, dealers are paid to do the work, and therefore become consumer advocates on many of these issues.”

Fleming’s assertion that franchise dealers are consumer advocates is shared by many who feel that dealers give the consumer the chance to have multiple dealerships working for their business and thus drive down vehicle prices. While much of the focus of this debate has been about Tesla Motors, Fleming said that allowing new bills to pass in Connecticut could alter the retail automotive landscape in the state. Currently there are about 270 dealerships in Connecticut, most family owned, and Fleming said during a news conference at the capitol that allowing non-franchised automakers to sell in the state would mean large and in his words, negative changes. Fleming explained, “There are a number of bills before the Legislature this year that we think will jeopardize consumer-protection provisions, which are concurrent to the franchise laws of the state of Connecticut.”

Fleming went on to say he feels franchise dealers in Connecticut can sell their cars better than Tesla could through their gallery stores. This is a point a conflict between the two parties. A representative for Tesla Motors pushed back against the idea of Tesla joining forces with dealers – for now. James Chen, Vice President of Regulatory Affairs and Associate General Council for Tesla Motors, told the Samford Advocate via phone that Tesla isn’t ready to sell through dealerships.

In that interview, Chen said, “Jim Fleming and the car dealers are trying to force us into their business model when we’re not ready. We’re a small manufacturer with aspirations, but forcing us into their business model now is a sure way to force us to fail. We’re certainly happy to sit down and work out an appropriate compromise, but it’s their way or the highway.” That compromise may or may not come. In the meantime, it appears that Tesla will continue to find themselves in state-by-state legal battles as they attempt to sell directly to consumers and bypass dealerships. We will keep you updated on this and other related stories involving dealership franchise laws.

What do you think? Will Tesla Motors ever sell their cars through franchised dealerships?