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North Carolina may likely bar Tesla to sell MS direct-to-consumers

http://wallstcheatsheet.com/stocks/will-tesla-get-kicked-out-of-north-ca...

Though I understand why this law is enacted, it is needless to say that the law only protects a special interest group that refuses to adopt the change in the industry led by TM. It reminds me the resistance by the brick and mortar business when online stores were developed in 1990s. Sadly, consumers in North Carolina who wish to obtain the best car in the world will suffer under this law. To me, this law is as silly as the law in indiana saying one is not allowed to carry a cocktail from the bar to a table; only the waiter or waitress can do it.

NC might be shooting itself in the foot on this one… I have more than a few multi-million dollar business clients with technology companies based there, and I don't think any of them want to fear what might happen if their state’s idea of 'capitalism', is no different than that of North Korea.

Such a law is not constitutional and will not likely hold up in the courts. (Commerce clause.) The franchise laws were originally set up to keep manufacturers from competing with franchise dealers selling their own brand. Tesla Motors is not competing against their own franchised dealers, they don't have any! That is why the dealer's lobby is trying for a new law, but the intent is completely different, and it will violate the interstate commerce clause.

And in the end, I hope the people of NC will not let this stand. (Come on, people, make some noise!) Tesla's direct sales model is sweeping the world, and costumers are appreciating it very much. This petty, stingy, corrupt, anti-American law will get blown aside at some point. The NADA is trying to hold back to tide, and they will only harm themselves by trying. In this case the market will truly decide. Adapt, dealers, get with the times!

Silly, self-defeating, short-sighted laws like this will not help NC or even Auto dealers themselves in the long run. It is a temporary setback in my view.

Yes, this one will not fly.
But they have to do something to appease their Dealer Assn.

So they try... and they try... and they...

There's a pretty big thread on tesla motors club forum about this. Interesting read. Mentions the donations to the bill's sponsor that have come from NCADA and how the argument is that this is about protecting the consumer (because we all know how well protected we feel as consumers when we go to dealerships).

My Model S was reserved 2 weeks ago. As a military guy stationed here in NC, it will be interesting to see how this plays out. Hopefully I am ahead of the impending red tape from big brother.

I'd say - good riddance NC.

Lots of other markets eager and ready. Export markets in particular. Look at China... say no more.

@GeirT

Me, too. Tesla should make an example of one hostile state. NC is perfect, as it purports to be a technology hotbed. Let the law stand as proof that the state is closer to Tobacco Road than Silicon Valley. Then, let them come begging when their affluent techies are clamoring for the Model S.

Didn't Apple just build a huge memory storage facility there? Where were the complaints when NC had to order on the internet - before Apple stores opened?

If big box retailers (wal-mart, target, costco) had an association they belonged to, we would see all kinds of laws against manufacturer direct to public purchases. This simply comes down to the NADA protecting their turf, and having the funds to do it. Its very unfortunate that if entities have enough cash and political mite, they can claim "the American way" and then shit all over capitalism. The only way this changes is grass roots efforts.

Ya, they should ally with electronics stores demanding the exclusive right to deal in Apples. Good luck with that! Then all the furniture dealers taking over Ikea sales, and then ...

North Carolina is going to have this law (if passed) set aside for several distinct reasons:

1. Commerce Clause - NC cannot prevent goods sold in commerce outside the state (that have been specifically OK'd by NTSB) from being registered. This is illegal. This is a SLAM DUNK.

2. Preventing phone communication & email - Commerce Clause & Free Speech violation. N.C. cannot prevent someone from communication with someone else. Sorry. This is also a slam dunk.

3. They might be able to get away with requiring Tesla to sell through a dealer (50/50) but cannot limit direct sales from California.

It's a good thing the party of small government, individual liberty, and no government regulation is in charge in both tx and nc.

David Trushin +1

@David Trushin | MAY 16, 2013: It's a good thing the party of small government, individual liberty, and no government regulation is in charge in both tx and nc.

This was passed unanimously by the NC senate (both Democrats and Republicans voted for this)

It is scary that this can happen in this day and age.

@David Trushin HaHa, can you say hypocrate?

@Alex K How did you draw the conclusion? Do you have the vote tally of how many Republicans and Democrats voted for, agaist or absentee? The news say the law was proposed and passed unanimously by the Republucan controled senate.

carlk, I think you answered your own question. It passed unanimously. More Republicans than Democrats therefore Rebublicsn controlled.

Politician of both parties almost always protect their sacred cows and real or potential donors. Not a democratic/republican issue in this case.

@carlk | MAY 19, 2013: How did you draw the conclusion? Do you have the vote tally of how many Republicans and Democrats voted for, agaist or absentee? The news say the law was proposed and passed unanimously by the Republucan controled senate.

Unanimously means "with the agreement of all people involved". The list of senators for the North Carolina Senate Commerce Committee can be found at http://www.ncleg.net/gascripts/committees/Committees.asp?sAction=ViewCom... . You can count the number of Republicans and Democrats in the committee by clicking on each of their names. It's 18 Republicans and 12 Democrats. I can't find any references to any actual official vote tallies.

@Alex K first and foremost it's a Republican controled senate. Often the minority party will vote absentee when they know their votes don't matter so not to offend either sides with the vote. You need to know how many of the 12 Democrats voted for the law before making such a statement. Not saying Democrats are saints. They might even favor the laws but they never accused Republicans of wanting a big government or trying to contol free entreprises.

Either way Republicans in NC are hypocrats for passing such a big government and anti-competitive law.

Whose campaign contributions were at risk? Everyone's.

What is going on in the State House? It must also pass the bill. Had to be submitted by last Thurs. (16th) AFAIK.

@Brian H hits it on the head.

Tesla is capturing all local revenue and leaves the locals eating a big dirt sandwich.

This will pass AND is unconstitutional as it hinders interstate commerce.

Regardless, it will only slow the bloodbath that's eventually going to befall the dealership model.

@SamoSam You are absolutely right. The more noise the they make the more negative attention they will be getting. Eventually every car buyers will realize they should not have to suffer under the stealership system and want the Tesla sales model.


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