LANSING – A bill introduced Wednesday by Rep. Aaron Miller would allow Tesla Motors to sell its electric vehicles in the state, although the car company doesn’t use the standard dealership model.
HB 5312 would strike the state’s prohibition on direct sales from a manufacturer. The bill also provides a geographical protection so a Tesla manufacturer would not be able to sell within 10 miles from a traditional dealership.
Miller (R-Sturgis) said it is a tough issue for constituents and lawmakers. And he said he is not looking to go after dealerships in his bill, which he said shows with the geographical protection.
“It’s a sensitive issue because dealers are wonderful business people back home. They are in almost every district in Michigan,” he said. “And yes they are wonderful players in the community. They donate to charitable causes, they participate in local activities, they are involved in their communities. And I think it’s fair to say that’s why it’s going to be a tough issue.”
The Auto Dealers of Michigan has fiercely resisted Tesla’s efforts to sell directly, saying it should abide by Michigan law requiring it to sell through a franchised dealership.
Tesla has mounted a major public relations offensive in the past several months, offering test drives of one of its vehicles to legislators and reporters. And it recently filed a request with the Department of State for a new and used auto dealer license as well as a repair facility license.
Miller said although the bill will be “inevitably called the Tesla bill” it is about a change in philosophy as well.
“Yes, Tesla is pushing this, everyone knows that. But to me it is about allowing a business model to operate in Michigan that currently is banned. It is that simple,” he said. “What I would like to do is start a discussion. “
The bill was sent to the House Commerce and Trade Committee, where Chair Rep. Joe Graves (R-Linden) said he is open to having a committee hearing on the legislation. He said he has met with representatives from Tesla previously, but has not yet seen Miller’s bill.
The Michigan Freedom to Buy coalition praised the introduction of the bill.
“Technological innovation and evolving market forces are rapidly impacting the new car industry. Consumers want more choices and more convenience,” Keith den Hollander, chair of the Michigan Christian Coalition, said in a statement. “They don’t want to be forced by the government to buy their cars from a certain type of monopoly retailer. They want the freedom to buy the cars they want in the manner they choose.”
Terry Burns, executive director of the Auto Dealers Association of Michigan, said his organization would have to review the bill with its members first. He did not disagree that it is at odds where his group has historically come down on such issues.
“It sure does go directly at the root of the franchise act,” he said. “Of course those will be factors we will take into consideration as we review it.”
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