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During the 2017-2018 New York State legislative session, which ended June 20, legislators were considering A8248A and its companion bill, S6600A. These bills would have allowed Tesla to expand from five to twenty stores in New York and did not require public spending. The bills had bipartisan support; forty-seven Assembly Members and twelve Senators were co-sponsors of the bills. The bills never came to a vote. This is a missed opportunity for New York and for the country.

Cars

Albany Should Let Tesla Expand In New York (Op-Ed)

During the 2017-2018 New York State legislative session, which ended June 20, legislators were considering A8248A and its companion bill, S6600A. These bills would have allowed Tesla to expand from five to twenty stores in New York and did not require public spending. The bills had bipartisan support; forty-seven Assembly Members and twelve Senators were co-sponsors of the bills. The bills never came to a vote. This is a missed opportunity for New York and for the country.

By Wayne Arden

During the 2017-2018 New York State legislative session, which ended June 20, legislators were considering A8248A and its companion bill, S6600A. These bills would have allowed Tesla to expand from five to twenty stores in New York and did not require public spending. The bills had bipartisan support; forty-seven Assembly Members and twelve Senators were co-sponsors of the bills. The bills never came to a vote. This is a missed opportunity for New York and for the country.

First, Americans can buy virtually anything directly from a seller, including big-ticket items such as airline tickets, appliances, furniture, and houses. Why should automobiles be any different? The second largest seller of automobile insurance in the US is Geico, and Geico sells insurance directly to the public rather than indirectly via agents. There are no issues of safety at stake. IIHS and NHTSA have recognized Tesla vehicles as leaders in automobile safety, being some of the safest vehicles ever designed. State governments should let the market decide, allowing each consumer to choose which sales approach, direct or indirect, he or she prefers. The current restrictions that limit Tesla’s ability to sell directly to the public are an unjustifiable interference in free enterprise.

Second, allowing Tesla to expand further in New York will generate jobs in high-growth market segments. In 2017, Tesla was the US market leader in sales of electric vehicles. If given the opportunity to expand, Tesla would respond by increasing sales in New York, sales of automobiles but also solar panels, solar roofs, and battery storage systems. Tesla’s expansion would spur competition and motivate others to respond in each of these segments. For example, per the Solar Foundation’s National Solar Jobs Census, solar employment grew 16% annually between 2012 and 2017 — nine times faster than the overall U.S. economy. At Tesla’s June 5 shareholder meeting, CEO Elon Musk stated that the battery storage industry will grow exponentially: “for many years to come, each incremental year will be about as much as all of the preceding years, which is a crazy growth rate.” Per Bloomberg New Energy Finance, the cumulative global investment in renewable energy and energy smart technologies since 2010 has been $2.5 trillion. Do we New Yorkers want to participate fully in the job growth represented by these promising market segments or will we be on the outside looking in?

New York is not an oil-producing state and does not have refineries. Consequently, nearly all of the money spent in New York on gasoline and diesel fuel goes out-of-state, to other oil-producing states or to other countries. By contrast, each electric mile driven would reverse that equation. About 85% of the electrical power consumed in New York is generated in-state. Therefore, as more New Yorkers choose to drive electric vehicles, they will generate in-state jobs: at utilities, Independent Power Producers (IPPs), solar panel installers, battery systems installers, etc. A back-of-the-napkin calculation of this effect is nearly $18 billion — that is a lot of economic stimulus. (This estimate uses the US DOE’s figure for 2016 transportation fuel consumed in New York of nearly seven billion gallons of gasoline and diesel fuel and assumes a price of $3.00 per gallon.) Readers from oil-producing states should note that a number of oil-producing countries, most notably Norway and the UAE, are investing heavily in renewable energy and electric vehicles to maximize export revenues generated from oil.

Third, accelerating the adoption of electric vehicles, solar panels, solar roofs, and battery storage systems will mitigate climate change. Per NASA and NOAA, 17 of the 18 warmest years on record have all occurred since 2001. In 2017, the Union of Concerned Scientists published a report titled “When Rising Seas Hit Home: Hard Choices Ahead for Hundreds of US Coastal Communities.” “From greater Boston to the tip of Key West, Florida, and from the Everglades in Florida to Corpus Christi, Texas, vast stretches of U.S. coasts will be host to chronically inundated communities by 2100 in both the intermediate and the high scenarios.” Researchers at the University of Colorado, Boulder, and Pennsylvania State University released a paper in May titled “Disaster on the Horizon: The Price Effect of Sea Level Rise.” Properties exposed to sea level rise across the country sell at a 7% discount relative to observably equivalent unexposed properties equidistant from the beach. The paper reflects the collective assessments of 460,000 buyers and sellers. American owners of coastal properties should be highly concerned; the discount has increased over time and, as global average temperatures continue to rise, will increase further.

Tesla is important because it is a catalyst for nascent high-growth market segments and a leader in sustainable technologies. Most Americans want a vibrant economy, a healthful environment, and actions taken to counter the ever-increasing effects of climate change. Eighteen states do not permit Tesla’s direct sales model: Alabama, Arkansas, Connecticut, Iowa, Kansas, Kentucky, Louisiana, Michigan, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Carolina, South Dakota, Texas, West Virginia, and Wisconsin. In addition, a number of states, similar to New York, limit Tesla to a small number of stores. I urge legislators in New York and in other states to unleash the private sector by allowing unrestricted competition.

 
 
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