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Tesla Motors Inc (TSLA): New York Direct-Sales Bill Has This Odd Clause

Tesla Motors Inc (NASDAQ:TSLA) has really been taking off in public perception over the last few months, and especially with the bang-up May that the company had. The company’ stock has tripled this year, the company reported its first quarterly profit in its 10-year history and sales are projecting to be north of 20,000 this year. But with that success lately has apparently gotten some dealer feeling a little threatened about their livelihoods.

Tesla Motors Inc (NASDAQ:TSLA)While Tesla Motors Inc (NASDAQ:TSLA) has been doing direct-sales of cars to consumers from the beginning – usurping the traditional intermediary dealership model – it has only been int he last three months that dealers have started to sweat a bit, anddealership groups have either gone to court or introduced legislation in several states that would ban direct-car sales in that state. Texas and North Carolina have already passed Tesla laws – sure, they are worded more broadly, but let’s call them what they are – and there are Tesla lawsuits happening in other states.

The latest anti-Tesla crusade is happening in the very populous state of New York, where Tesla Motors Inc (NASDAQ:TSLA) does have a couple of stores and facilities in and around New York City. The New York Assembly is about to take up a bill that would restrict direct-to-consumer sales of cars, forcing all new-car transactions to occur through dealerships. “The bottom line for New York consumers and New York suppliers is that if this bill passes, special interests in Albany will once again have gotten their way while robbing New Yorkers of choices,” said Tesla VP Diarmuid O’Connell in a statement. “Tesla will be put out of business in New York.”

While Tesla Motors Inc (NASDAQ:TSLA) is focused on that main thrust of the bill which would affect the company’s very life in The Empire State, there was one part of the bill that, at least in the report we read, was pretty much glazed over, and it struck a chord. According to the report, the legislation would prevent car manufacturers from selling directly to consumers and block new vehicles not purchased in New York from being registered in the state.” (Emphasis added.)

So if we are reading this right (and we thing we are), this bill reads as if it will not only prevent direct-sales of cars from manufacturers in the state, but it will also keep New Yorkers from going to adjoining states (which may have lower taxes and cheaper prices on cars) to buy their new car and register it in New York? New York would only recognize and register vehicles that are bought inside state lines? Is it just us, or does something smell fishy in Denmark?  What do you thnk abot this? Do you think Tesla Motors Inc (NASDAQ:TSLA) should have a right to sell its prodcuts however it sees fit? And do you tink it should matter where cars are bought for registration purposes? We’d like your feedback on this in the comments section below.


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