Tesla Wakes To Rude Surprise As Chris Christie Administration Does Opposite Of What It Said
Update: the Christie administration approved the rule, which means Tesla can not sell its vehicles in the state starting April 1st, even at existing Tesla stores.
Let me put this right out there: time and time again I’ve seen NJ Governor Chris Christie say one thing and do another — of course, he says the right things, but then he goes and does some very wrong things. As a result, I don’t like the guy.
His administration (I have no idea how much he’s involved in this one) has gone and done it again. It has been in communication with Tesla for months regarding how to go about dealing with a dealership attack on Tesla. The plan has been the most logical one: let the matter go through the New Jersey Legislature. But, woops, the Christie Administration seems to have slipped and simply decided to kick Tesla out of New Jersey through executive order. What a great way to run a free-market democracy! (Or, wait, perhaps that would be an competitive, overly regulated, dictatorial “mommy state.”)
Can you tell that this one is irritating me a bit? It’s not just that the Republican Christie administration has, like Texas policymakers, hypocritically decided to interfere in the free market in a way that benefits almost nobody. It’s also the deceitful approach the administration seems to have taken.
Here are plenty more details from Tesla Motors:
Since 2013, Tesla Motors has been working constructively with the New Jersey Motor Vehicle Commission (NJMVC) and members of Governor Christie’s administration to defend against the New Jersey Coalition of Automotive Retailers’ (NJ CAR) attacks on Tesla’s business model and the rights of New Jersey consumers. Until yesterday, we were under the impression that all parties were working in good faith.
Unfortunately, Monday we received news that Governor Christie’s administration has gone back on its word to delay a proposed anti-Tesla regulation so that the matter could be handled through a fair process in the Legislature. 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. Having previously issued two dealer licenses to Tesla, this regulation would be a complete reversal to the long standing position of NJMVC on Tesla’s stores. Indeed, the Administration and the NJMVC are thwarting the Legislature and going beyond their authority to implement the state’s laws at the behest of a special interest group looking to protect its monopoly at the expense of New Jersey consumers. This is an affront to the very concept of a free market.
Proposal PRN 2013-138 seeks to impose stringent licensing rules that would, among other things, require all new motor vehicles to be sold through middlemen and block Tesla’s direct sales model. This move comes in spite of discussions with the Governor’s staff as recently as January, when it was agreed that Tesla and NJ CAR would address their issues in a more public forum: the New Jersey Legislature. Instead, rather than engage in an open debate on such a significant policy issue, the Administration has expedited the implementation of a new law that the Commission intends to stealthily approve at a meeting in Trenton today at 2:00 PM EDT.
We are disappointed in the actions of the NJMVC and the Christie Administration, which come on the heels of more than nine months of unexplained delays in the issuing of a new sales license for Tesla, despite our numerous requests, calls, and letters. In addition, the NJMVC has also delayed the annual renewal of Tesla’s current dealer licenses without indication of the cause of the delay. The delays have handicapped Tesla in New Jersey, where, without clear licensing procedures and fair enforcement of existing law, we have been forced to delay our growth plans. This is an issue that affects not just Tesla customers, but also New Jersey citizens at large, because Tesla would be unable to create new jobs or participate in New Jersey’s economic revival.
At the same time, neither Tesla nor the taxpayers of New Jersey have been able to participate in any of the analysis or been granted a hearing as requested last year when this was first proposed. Despite being the subject of the regulation, we were only able to obtain information about today’s meeting with less than 24 hours notice and in direct contravention of assurances by the Governor.
We strongly believe it is vital to introduce our own vehicles to the market because electric cars are still a relatively new technology. This model is not just a matter of selling more cars and providing optimum consumer choice for Americans, but it is also about educating consumers about the benefits of going electric, which is central to our mission to accelerate the shift to sustainable transportation, a new paradigm in automotive technology.
We urge the Christie administration to act in good faith and withdraw the proposed amendment, or amend it so that it reflects the true intent of the Legislature and the people of New Jersey.
Image Credit: Chris Christie via L.E.MORMILE / Shutterstock.com
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It’s funny. You would think that siding with the car dealers is no way to improve the fat guy’s image after the GW bridge crap.
“He [Christie] says the right things…” Like insulting defenceless citizens in public? The man’s a demagogic yob, in British English.
Granted, not always. But he’s quite talented at pretending like he cares and saying what the public wants to hear, despite doing the opposite. There’s a reason he’s a top candidate for the next Republican presidential nomination.
Christie got some attention because he said a few things that indicated that he was a more of a problem solving Republican than a right-wing ideologue. And people were entertained by his loud mouth.
Upon close examination it seems that he isn’t the Teddy Roosevelt some were hoping.
This article got me going so I started a new petition. Probably won’t do anything other than make me feel better. http://wh.gov/lVq03
I– who is short the stock– agree that it’s ridiculous that the company can’t have showrooms in New Jersey. However, I feel it’s EQUALLY ridiculous that buyers of its $100,000 cars are exempt from the 7% New Jersey state sales tax. So do you “free market Teslarians” want to pick and choose your “free markets” or are you willing to eliminate BOTH policies?
So you’re saying that people in New Jersey can’t buy a Tesla without going to a different state. And when they buy a Tesla in a different state the state of New Jersey should collect sales tax?
(I guess if you’ve gone short on Tesla then you might wish for anything that would keep the stock price from rising….)
You pay your sales tax where you register your car. As it will now be, Tesla buyers will be able to buy their cars elsewhere (or on line) and register them in Jersey without having to pay sales tax. On the other hand, if a New Jersey resident buys a non-electric car out of state and then registers it in Jersey, he has to pay 7% New Jersey sales tax.
What if they end up buying a used car, where the sales tax has already been paid in New York? (This would apply after the sales tax rebate is ended)
Two separate issues. Your bias is showing. Shorting not working out too good for ya?
In one sense they’re “two separate issues” but in a larger sense they’re both examples of “state mandated unfairness.” Why should Tesla be able to keep the “non-free-market” provision it likes while losing the one it doesn’t? I don’t blame them for trying, but f— them and their hypocricy.
“f— them and their hypocricy.”
What is hypocritical about saying “If we can’t sell our cars in your State, then we’re not paying sales tax to you for the cars we sell outside your State.”?
First of all, it’s the NJ state resident (not the merchant, who just collects it) who pays the sales tax to help pay for services in the state in which he lives. However, I’m not even saying that it’s hypocritical if they’re willing to accept the state ban in exchange for the tax exemption– I’m saying that it’s hypocritical to simultaneously argue that the company-owned dealership ban is unfair or “anti-free market” while happily accepting the unfair and anti-free-market sales tax exemption.
Tesla is refusing to pay the sales tax until they can sell their merchandise.
You’re who’s hypocritically demanding that Tesla be forbidden from operating in the State, but must pay taxes anyway.
Isn’t it the Republicans that typically say, “keep govt out of the way of business”? Except of course if it is innovative and challenges the status quo, the good ol boy network, or doesn’t come with the statutory bribes. Sad that an american designed and built product is shut out like that. New Jersey is a small state. Put the Tesla stores all around their borders. Too bad they let Tesla invest in stores there before changing the game. That creates a poor business environment that will be seen by other businesses thinking about working there.
I bet bookstores, shops and music stores are thinking why the heck didn’t they have a powerful lobby to insulate themselves from the advances of the internet and the new sales models it brought with it. Of course, certain lobbies in those industries have been up to their own dirty tricks and their dire reputations reflect that. The internet is a possibility for people to save money – which inevitably means a redistribution of jobs, but it’s also clearly more efficient, for consumers and businesses. Imagine if the manufacturers of physical typewriters had had such a veto on digital keyboards…
Wow, for sale to any embedded business interest, to hell with the interests of the people of his state, to hell with fair competition in the market. This guy is looking better as a presidential candidate all the time. That’s how I like them, speaking with a forked tongue.
This is GREAT news! This means more FREE publicity for Tesla! Having the infamous gov Christie involved is priceless! I’m not joking, this is awesomely good for Tesla. Keep it up auto dealers because it helps Tesla keep their advertising budget at zero dollars.
Jim – you really miss the point. If Tesla made crap cars, this would count for zero. They enjoy publicity because they are the best at what they do, even if they are trying to do it while having both hands tied behind their backs by sleazy and non-competitive rivals.
I do think Jim has a point.
The fact that it is the corrupt Christie combined with the totally undemocratic process, this can only serve to raise eyebrows and make people ask questions about what shady backroom dealing has been going on here and what favours were exchanged.
Time will tell, but this may be a pyrrhic victory for the auto dealers.
Let’s see:
On one side, an entrepreneurial business that’s getting America off of foreign oil.
On the other side, a corrupt bullying Governor and his used car dealer buddies.
I wonder who the average person will support?
Well, who got elected? Don’t underestimate human stupidity.
Viral free publicity for Tesla. I couldn’t be more pleased!
“Tony Soprano” must have put some of that undeclared cash inauto sales (new or used). Of course “Tony” doesn’t like competition from a superior product. Christie had his hand out and didn’t get it crossed with silver. Christie retaliated. What a surprise
“Christie had his hand out and didn’t get it crossed with silver.”
Wouldn’t a silver cross make him burst aflame?
You are probably right. Thanks for the chuckle
You’re welcome.
How about if Tesla Owners would form a cooperative which would obtain dealership licenses in all states and run the dealerships. Each owner becomes a cooperative member. The cooperative would then select Tesla to manage the dealerships.
The auto dealer lobby would unite against this as well. Regulations in some states would also make it impossible, or just plain too costly to pull off too. Strangely, I think anti-monopoly laws might make it tough for only one Tesla “dealer” to operate in each state. And Tesla couldn’t manage these dealerships anyway since that’s exactly what they want to do in the first place and are being denied by these protectionist laws.
One commenter here has complained about the “sales tax” issue and It’s a fair complaint. Constitutionally, I don’t see how the State of NJ can dictate a companies business model. They could, however, address the tax issue. But, as noted, this is more about government (and the Governors) corruption and cronyism. After the new scandal around Christy that emerged yesterday I see him as a (dead) lame duck politician who will be retired soon.
Now, can we get back to having better (clean) cars…
And to think at one point in time I thought about voting for this guy.
If New Jersey was one of the states being considered for the gigafactory, Christie would be showing a different face. Of the many faces he has.
If Tesla needed to advertise they could have this slogan. Tesla, the car banned in five states!
Tesla is a disruptive company. It’s tossed the old myths of EVs being slow and range limited out the window. It’s sealed the fate of the internal combustion engine car.
It’s showing that we don’t need to spend extra for a middleman dealership which is generally nothing but a pile of agony.
It’s redefining the service station.
Tesla – making a lot of enemies as it makes significant changes to how we drive.
That Christie would side with the auto dealerships is no surprise. He comes across as one of those loud-mouths who deal cars and jerk their customers around.
“Of the many faces he has.” – Ha, so many faces….
Like the ad line. Might start using it myself 😀
It’s ironic that Tesla can sell cars in China and Norway but not in New Jersy!
Free-dum!!!
Another good line 😀
Tesla can sell cars in China but sales are banned in several US states. The irony meter is off the scale!
Banned in some of the states whose governors and legislators make the most noise about free markets.
BTW, I really doubt these bans would hold were Tesla to take them to court. Those states already permit direct sales of other goods. I suspect they all have outlet stores run by manufacturers.
But right now Tesla has plenty market opportunities and this is great free advertising.
Oh, take them to court. Let’s see how that goes. I bet the free advertising outweighs the financial cost of the lawsuit… and tesla wins new markets.