The ongoing battle between Tesla Motors and various auto dealership associations throughout the country grinds on … with Tesla apparently losing the ability to sell directly to consumers in Missouri (following the decisions by a local judge to deny Tesla’s request to temporarily halt his earlier judgment while the case is appealed).
However, Tesla was then quickly granted its motion to stay (or temporarily halt) the lower court’s judgment by the Missouri Court of Appeals.
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As some background, a circuit court judge ruled last year that Tesla is “not a franchisee” and thus should not have its soon-to-expire motor vehicle dealer licenses renewed by the state. These licenses, for University City and Kansas City storefronts, were set to expire this week.
As one would guess, the Missouri Auto Dealers Association (the organization that filed the suit) was happy with the lower court’s decision. And the association’s attorney, Lowell Pearson, was quoted following the judgement as saying (to the local Post-Dispatch): “I think it was correct under the law as we argued before the court.”
But, alas … the Missouri Court of Appeals has decided to grant Tesla its motion to stay the judgement during the appeals process. So, the stores will remain open for the time being, even though their future remains an uncertainty.
A statement from a Tesla rep to the Post-Dispatch read: “Tesla appreciates the Court of Appeals’ decision to keep our Missouri stores operating. We are now arranging to reopen our doors and will do so as soon as possible. Again, we regret this temporary inconvenience to our customers.”
Predictably, Missouri Auto Dealers Association president Doug Smith has commented that they will continue “to fight” Tesla. He stated: “There are 40 manufacturers who do business in the state of Missouri and they all use the franchise model. We want an explanation on why this one company gets to operate in an exclusive fashion that’s different than all these other manufacturers.”
I’m sure that Smith could answer that question himself if he really wanted to — the reasons are obvious. The dealerships have financial reasons not to sell Teslas, or to do so poorly. If Tesla was forced to rely on the dealership model, and all of the conflicting interests of those involved in it, the electric car company wouldn’t be able to sell its vehicles in anything like the number that it now does.
The dealership protection laws were created for reasons that were valid nearly 100 years ago, but they’ve outlived their usefulness and now just serve to protect the racket that is the modern car dealership business, which is far past its best-by date.
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