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General Motors Company (GM) Joins State Auto Dealership Lobbies To Prevent Tesla From Selling Cars Directly

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According to media reports, GM is pushing for Indiana residents to push for a bill that would ban Tesla from selling its electric vehicles directly to the general public

It seems Tesla Motors Inc (NASDAQ:TSLA) is up against a new competitor in its battle with auto dealership lobbies across various states: the country’s largest automaker, General Motors Company (NYSE:GM).

According to a report from Auto Blog, GM is supporting a bill that will put an end date on licenses for automakers that sell vehicles directly to consumers in the state. The bill will be up for debate at the Indiana state legislature this week.

Although Tesla does not have direct evidence to suggest GM authored the bill, the company’s spokesperson clearly mentioned – to AutoBlogGreen – that Tesla believes GM supports the bill as a means to outplay Tesla in the emerging competition in mass market electric vehicles, setting stage next year.

Tesla is planning to roll out a smaller 200 mile-range $35,000 electric Model 3 sedan next year while GM is launching a mid-range Chevrolet Bolt electric vehicle also in 2017, with travel range and price tag comparable to Tesla’s Model 3.

While Tesla at large compares poorly to GM in terms of unit sales and size of operations, analysts believe the competition will be legitimate given that over the past three years or so, Tesla has pioneered an electric vehicles revolution not only in the US but several other key markets for clean energy vehicles like Europe and Asia.

According to Ars Technica, GM has been touting Tesla fans and vehicle owners in Indiana to favor the bill it believes supports the broader market for autos in the state. Talking in favor of a diverse network of independent auto dealerships, GM in a statement to Ars Technica said, “A benefit of a nationwide network of thousands of dealerships is that General Motors customers never have to worry about driving to another state to buy service or support their vehicles.”

But Tesla has its own defense ready. CEO Elon Musk claims independent dealerships offer inconsistent service, portray the brand poorly and function with an inherent conflict of interest that arises from higher inventories of traditional vehicles compared to electric vehicles.

Tesla has noticeably turned sour recently towards states barring it from selling its vehicles directly. The company even skipped the all-important North American Auto Show this year protesting such a ban in Michigan. In Indiana alone where Tesla currently is allowed to sell vehicles, Tesla claims it has spent over $42 million on the state through supplier contracts and is also mulling building a sizeable 26,000 square foot Tesla Service Station in the state which may be put on hold if the bill does get passed.

 

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