With its denial to let the EV maker operate under its unique business model, Connecticut Senate has disappointed Tesla for the second consecutive year
Despite Tesla Motors Inc.’s (NASDAQ:TSLA) back-to-back efforts last year to obtain the direct-sales license, it has recently received a red signal from the Connecticut State Senate. The opposition from CT Automotive Retailers Association (CARA) and traditional automakers was strong enough to put an end to the legislation once again.
According to recent CT Mirror report, Senate Majority Leader Bob Duff (D-Norwalk), the sponsor of the Tesla bill, killed the legislation last week, after the opposing parties effectively lobbied and ensured that the electric vehicle maker does not operate under its business model in the state. Mr. Duff stated: “We’ll come back again and try in another year.”
The young EV maker carried out a similar effort that won support from the House of Representatives, but was not passed without voting. Although Mr. Duff fully supports the bill, he requires projecting the state’s interest and his caucus, which was divided.
The House of Representatives still support the company’s efforts though, as the House Majority Leader Joe Aresimowicz reportedly said that the representatives are prepared to pass the legislation again. Tesla wants no restrictions in the bill, but still had to agree with three stores after recommendation of State Representative Tony Guerrera (D-Rocky Hil), co-chair of the Transportation Committee which sent the bill to the Senate in March.
While the automaker has operated a service facility in Milford for years, it recently received approval from the Greenwich Planning and Zoning Board of Appeal to open its first store in the state. General Motors Company (NYSE:GM), which tried to influence lawmakers to stop Tesla from directly selling in Indiana, was also present in this session to ensure that Tesla does not make any progress in its direct-sale fight.
Tesla believes that the automaker and other car dealers are using legislative bodies and legislators to kill a business strategy, while introducing a competing vehicle, i.e. the Bolt EV. Conversely, General Motors thinks the law should be the same for all the players in the industry and completely opposes a separate playing field for Tesla and other EV makers, along with CARA.
Since the state is not ready to give Tesla the auto franchising licensing, Tesla General Counsel Todd Maron is working with his team to take the direct sales issue to the federal court. The company will fight to gain direct sales approval for six states, including Connecticut.