Tesla CEO pushes Texas to allow direct-to-consumer car sales

Wed Apr 10, 2013 6:40pm EDT
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By Corrie MacLaggan

AUSTIN, Texas (Reuters) - Tesla Motors Inc (TSLA.O: Quote) Chief Executive Elon Musk is pushing to change Texas law to allow his electric car company to sell directly to consumers, and he took his fight to the state Capitol on Wednesday.

Texas law prevents Tesla from selling its cars directly to the public - as it does in other states - because it does not have a relationship with a franchised dealer. In Texas, new vehicles are generally required to be sold through dealers.

"Nothing could be further from what Texas is all about," Musk told reporters at a Capitol press conference on Wednesday, citing examples of Texans such as Michael Dell who have succeeded in direct-to-consumer sales.

A proposal in the Texas legislature would allow U.S.-based manufacturers of electric or battery-powered vehicles to sell directly to consumers in the state.

The Texas Automobile Dealers Association opposes the legislation, which is pending before committees in the House and Senate.

"We don't see any business reason or law reason that this product should receive a special exception from the law that applies to everyone else," said Rob Braziel, CEO of legislative affairs of the Texas Automobile Dealers Association.

Braziel said the association is worried that any manufacturer of electric vehicles could use the new law to compete directly with their own dealers.

State Representative Eddie Rodriguez, an Austin Democrat and the House author of the bill, said that he'd like to see the auto dealers come to the table to negotiate.   Continued...

Tesla Chief Executive Office Elon Musk attends a celebration at his company's factory in Fremont, California, June 22, 2012, as the car company began delivering its Model S electric sedan. REUTERS/Noah Berger