New Jersey Removes Legal Impediment To Direct Tesla Sales 85
As reported by The Verge, the rule-makers of New Jersey have relented, and will now allow a slightly freer market for cars.
Almost exactly one year after it was banned from selling its cars directly in New Jersey, Tesla will be back in business in the Garden State. Governor Chris Christie signed into law a bill this afternoon that reversed last year's ban. The new legislation comes with some limits. Tesla can only open a total of four direct sale dealerships and has to operate at least one service center. But it's a major win following a heated war of words that saw Tesla CEO Elon Musk compare local dealers to a mafia protection racket subverting the democratic process.
Just 4? (Score:5, Insightful)
Because if they opened more than four, that would be just... what?
Re:Just 4? (Score:5, Funny)
Because if they opened more than four, that would be just... what?
5
Re:Just 4? (Score:5, Funny)
Because if they opened more than four, that would be just... what?
5
Which would be right out.
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Still funny to me most 40 years later, I logged in just to see if I could vote you up... Thx.
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Honestly, this state is so dang small that 4 would put every person in the state within 40 miles of one (if they are smart about where they put them...) Figure one in the South Jersey area (around where I live in Cherry Hill, which is close enough to pick up all of the Philly buyers), one in North Trenton, and then 2 more up north closer to NYC...
Re:Just 4? (Score:5, Funny)
Uhhh
So is a Tesla designed with a 40 mile reserve so you can get to a dealer so they can charge it?
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Re:Just 4? (Score:5, Insightful)
I lived 35 years in Jersey and my family is still mostly there. I had a few years when all I did was drive from one dealership to another doing auto insurance claims. The place is full of car dealerships. They tend to be in clusters along old highways, though sometimes embedded in urban neighborhoods too. The last thing Jersey needs is more car dealerships and lots. So I can see the numerical limits as having some merit. It's a crowded place, and more lots competing for the same number of buyers is not really an improvement, however much Elon Musk doesn't want to use existing dealer networks. Or how much people want Tesla electric vehicles out on the road.
Yeah, if only there were a way for everybody together to decide how many auto dealerships are needed. We could call it a "market".
But, yeah, silly stuff. We should centrally plan how many dealerships there should be. It'll work out much better.
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Re:Just 4? (Score:5, Informative)
Have you ever heard of the concept of zoning? Think of this as zoning on a statewide level.
Oh, come on. This bears no resemblance to zoning at all. Zoning establishes areas by use (e.g. commercial, residential, industrial...we've all played SimCity), not by company name on the sign out front. If you want to call it zoning at a state level (presumably to limit the number of dealership lots in the state, as you said in your earlier post), then where are the restrictions on those uses for the rest of the industry? And if this really is zoning, then what's to stop them from simply buying out an existing dealership that is already "zoned" appropriately so that they can increase their count from 4 to 5 in the state?
Oh, yeah, there's a law that's shackling just them and no one else so that they're prevented them from doing exactly that.
Call a spade a spade: it's a caveat tossed in to appease the other side by establishing an unjust restriction on one company's ability to compete in the market. Don't try to pass this off as being something that even remotely resembles zoning.
Re:Just 4? (Score:5, Informative)
Um... the law says "Tesla" at what part of the text?
The part where it says "like Tesla Motors" in the actual text of the law [state.nj.us]. It both mentions Tesla explicitly as an example of who this law applies to...
This bill provides that ZEVs may be directly sold by certain manufacturers, like Tesla Motors [...]
...as well as implicitly refers to Tesla in that the bill is tailored such that it will only ever apply to Tesla. Namely, the bill only applies to manufacturers of Zero Emission Vehicles (ZEVs) engaging in direct sales who were licensed by the New Jersey Motor Vehicle Commission on or before the start of last year. The only company on that list or that will ever be on that list is Tesla.
Just because they do things differently now, what if there are suddenly "Tesla2", "Tesla3", and so on?
There can't be. See the provision above about the date. Even if a "Tesla 2" manufacturer came along and managed to get licensed by the New Jersey Motor Vehicle Commission (which they can't be, since I believe the part of last year's law that prohibits them is still on the books), they wouldn't have done it before the start of 2014, meaning they wouldn't be eligible for this exemption.
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...as well as implicitly refers to Tesla in that the bill is tailored such that it will only ever apply to Tesla.
This is called a "bill of attainder" and is explicitly prohibited by the US Constitution. (A bill of attainder is defined as a law that makes someone a criminal without due process in a court of law, but by allowing only X number of dealerships they have, defacto, criminalized the act of having X+1 for this one specifically named "defendant".)
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Oh, come on. This bears no resemblance to zoning at all. Zoning establishes areas by use (e.g. commercial, residential, industrial...we've all played SimCity), not by company name on the sign out front.
Then it is just like many recent zoning battles. When the company name is 'Walmart' people come out of the woodwork to try to rezone/add limiting land use overlays/etc to try to stop one from being built.
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And if Tesla ever reaches the power of Wal-Mart, it might be appropriate to make laws that apply to it and no one else, to preserve that precious market. Right now, it isn't.
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That's not deciding how many are needed, it's experimenting to see how many can survive.
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Which is not to say that it's a bad thing, just that it doesn't match the suggested description
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Re:Just 4? (Score:4, Interesting)
The last thing Jersey needs is more car dealerships and lots. So I can see the numerical limits as having some merit.
Have you ever been to a Tesla dealership? They are nothing like typical dealerships. They don't have sprawling lots full of cars. They are small, typically in pedestrian friendly areas nowhere near other dealerships, and have just enough cars that you can look at the models and options, with a few more cars for test drives. They're more like a retail store than a dealership lot. Here [autoblog.com] is a blog with pictures of dealerships around the world.
Each car is built to order, and you come pick it up at the dealership or they deliver it to you. I suspect the limit is a compromise with opponents of Tesla's model, not anything to do with too many dealerships.
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Yep, that's why they call them "showrooms" instead of "dealerships".
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https://www.youtube.com/watch?... [youtube.com]
Maybe these guys are running the state?
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screw over family owned businesses to support large corporations. The protection of dealerships was originally created for good reasons. Large corporations were screwing over small dealers. Now the Republicans have trashed all of those protections.
Pathetic troll [wikipedia.org].
Currently, the Democrats are the majority party in both Houses. In the Senate there are 24 Democrats and 16 Republicans. There are 48 Democrats and 32 Republicans serving in the General Assembly.
The sad thing is that there are tards that will actually believe you since you're bashing someone they disbelieve.
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His sentiment seems to be an attack on the Republican Governor, not the Democratic Party - whose members voted to allow Tesla to operate after the Governor decided to enforce a law that impeded Teslas operations in 2014. But who know whats in his mind...hes a slashdotter.
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Hmm, most car dealers are republicans, most states banning Tesla direct sales are under republican control...well, no matter. Why should a particular line of local business get protected from big chains and large corporations? I don't recall anyone yelling when the big chains and then online outfits started selling computers and undercut my business. I'm betting there are a lot of family business that went under when WalMart moved to their town. Again, why should car dealers be protected?
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The protection of dealerships was originally created for good reasons.
Don't see many supporters of this perspective on /. I am ignorant of the reasons you speak of. Can you go into more detail on them or provide a link?
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From:
http://en.wikipedia.org/wiki/Car_dealerships_in_North_America
"state laws in the United States prohibit manufacturers from selling directly, and customers must buy through a dealer."
They laws were enacted to keep large, powerful corporations from putting all of the small businesses out of business that sold cars. GM tried to destroy every single car dealer in this country at one point, and several states stepped-up to protect those small businesses from attack. Now the Republicans have removed those p
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Re:Sad to see the Republicans always... (Score:5, Informative)
A) Democrats have near-supermajorities in both the Senate and General Assembly of New Jersey (60% in both). Chris Christie may be a Republican, but he can still only sign the laws that are put in front of him. Regardless, that really doesn't matter, since the same politicians who established this law last year are undoing their own work now. Partisanship shouldn't be entering this discussion.
B) I'd love a link to the history of car franchising in America. I have yet to see one and would love to know what the history was or why those protections were established in the first place. Because, based on what I understand so far, they seem to be ancient, anti-competitive laws established by states in response to a perceived crisis that ended decades ago and which are now being used by the formerly-underdog players to abuse their now-dominant positions.
But maybe I have it wrong. Either way, I'd love any links you might have on the subject.
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Because, based on what I understand so far, they seem to be ancient, anti-competitive laws established by states in response to a perceived crisis that ended decades ago and which are now being used by the formerly-underdog players to abuse their now-dominant positions.
That's basically my understanding of the issue. Wikipedia [wikipedia.org] is a good start.
This NADA PDF [nada.org] has the North American Dealership Association view on it. Unsurprisingly, it supports independent dealers, though their little sheet doesn't impress me.
Reading their 'differences', I'm reminded of firearms as being the next most closely regulated product. There dealerships are also the 'norm', but if Winchester(for example) wanted to open a store somewhere, they would be fully able to do so under their license. Irreg
Re:Sad to see the Republicans always... (Score:5, Informative)
Planet Money did a good podcast episode on why buying a car is so horrible:
http://www.npr.org/blogs/money... [npr.org]
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Yeah, I did some more research after my post and discovered that I was incorrect when I said that it's the same politicians undoing their own work.
Instead, what apparently happened was that the Christie-appointed members of the New Jersey Motor Vehicle Commission barred Tesla from selling cars in the state, thus circumventing the legislature entirely. It's taken the Democrat-controlled legislature until now to get a bill back in front of Christie that undoes that damage (and even then, it doesn't undo all o
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Are there any actual Tesla dealerships operating in any state yet? If not, then Tesla selling directly to customers who want Teslas instead of Fords, or Chevys, or any other brand is not threatening any businesses. I am guessing Ford and other dealerships are not selling Teslas? If not, then they have no cause to complain since Tesla is selling to those who want Teslas.
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It's BS. Basically, auto dealerships are run by rich locals who are very politically connected with the local government, and they get laws passed which are favorable to their business. Car dealerships are nothing more than a tax on cars, as they add to the cost (through their overhead), but don't provide anything in return. They are a middleman, and middlemen always add cost. Car dealerships (independent, non-factory-owned) are an entirely American phenomenon; they don't exist in other countries. Stud
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Does the mafia still control 80% of those "small businesses" like they used to? My brother in law used to work for a used car dealership until he realized how corrupt and controlled most of them were.
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Huh?
Re:Sad to see the Republicans always... (Score:5, Informative)
Except now the problem isn't the small dealerships. It's the huge dealership conglomerates that are worth billions. The laws were created in order to prevent the likes of GM from competing directly with third-party dealerships. In the case of Tesla, there are no third-party dealerships with which to compete.
Also, with the Tesla model dealerships don't really work. Every car Tesla sells is made to order. There is no inventory sitting around at dealerships. The customer orders exactly what they want and it's made to order. This is very different than a traditional dealership where the dealer buys an inventory of cars then turns around to sell it to the customer.
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Also, with the Tesla model dealerships don't really work. Every car Tesla sells is made to order. There is no inventory sitting around at dealerships. The customer orders exactly what they want and it's made to order. This is very different than a traditional dealership where the dealer buys an inventory of cars then turns around to sell it to the customer.
Yeah it seems the only reason you'd want to go to the dealership would be to look at the car and maybe get a test drive. Tesla should crowdsource this to their user base. Maybe they could receive a spiff off of their yearly maintenance fee for demoing the car for prospects. What Tesla driver isn't going to want to show off their car? Everything else from optioning to ordering could be handled online.
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What Tesla driver isn't going to want to show off their car?
Yes, what Tesla driver doesn't want a bunch of strangers driving their car and possibly robbing/assaulting/killing them?
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Yeah it seems the only reason you'd want to go to the dealership would be to look at the car and maybe get a test drive.
Well, the traditional reason is that you can drive off the lot the same day with a car. Something that Tesla has yet to have the stock to do. So even if you were a 'dealership' you'd have to be calling to tell customers that their new vehicle has arrived. Removing one of the 'benefits' of being a dealer.
That Tesla, thus far, has had only 1 vehicle model at a time to worry about, it simplifies the 'test drive' thing enormously.
As for crowdsourcing their 'test drives', it works somewhat, word of mouth is a
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Yeah it seems the only reason you'd want to go to the dealership would be to look at the car and maybe get a test drive.
Actually, as I understand it (and, no, I don't own a Tesla, but I keep checking their website in the desperate hope that there'll be a roadster there), they don't have "dealerships." Instead, they have "showrooms" where you can go look at the car and get a test drive. But, as I understand it, you can't go to one and drive away in a brand new Tesla.
Remember the old Gateway Stores? It's kind of like that.
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I mean, can you imagine if Verizon wasn't allowed to sell phones or services directly? You go to a Verizon "dealer" and they get to add 5, 10, or 30 dollars onto your monthly plan if you can't negotiate it down?
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The protection of dealerships was originally created for good reasons.
And my gosh, has it been an amazing success story! I mean, is there anyone who doesn't absolutely love the new car buying experience from our independent dealers?
Yey to the Oil and Petrochemical Refinery State! (Score:1)
Gawd I Love Free Enterprise! (Score:1)
Seems to be mostly about the incumbent businesses exercising the levers of government power to stifle competition and trample the consumer. Go capitalism!!
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Wait till there are 5 or 6 electric car manufacturers building cars similar to Tesla. At that point, do you one separate, unique showroom per brand? That seems like a waste of space, salesmen, and mechanics. A more practical solution would be 3 car brands per dealership.
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Jesus! (Score:3)
Re:Jesus! (Score:5, Funny)
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Re:Jesus! (Score:5, Insightful)
Why does this lie keep getting repeated and repeated and repeated and repeated. . . It's been going on for YEARS now. It gets frustrating after a while, especially since anybody could spend a couple of minutes with Google and find out the facts.
I think most normal people without an axe to grind understand that there are other sources of electrical power besides coal, and that we do have nuclear plants, and we do have hydro plants, and we do have natural gas, and we do have wind farms, and we even have a small (but rapidly growing) amount of solar. Some of them may even known that the percentage of power from coal in the US has been dropping for years and is well under half now. So, when you talk about a highly polluting coal-powered electric car, you're only making yourself look dumb in front of everyone.
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No. let's stick to the better argument. A 100% coal powered grid would still outperform the gasoline cars we have now on an emissions basis.
The ventriloquist goes 2 heaven,the dummy does not (Score:1)
Sigh. A refresher course on terminology.
This was indeed a mafia-like protection racket, but it did not subvert the democratic process. It subverted freedom. It was an example of the democratic process, which subverts freedom all the time.
I am not speaking of using it to form a more orderly society straying from anarchy. Rather, democracy's use in practice often involves setting up special favors that are the opposite of a free market.
why don't all manufacturers sell direct? (Score:2)
the biggest benefit of the private dealership racket is that they buy cars from the mfg, leaving the manufacturer off the hook. if mfg's were forced to all sell direct, they'd have more reasons to focus on building quality cars.