Electric-automobile giant Tesla Inc. may have to go through a tedious procedure of shipping its Texas-manufactured cars to other states before it can sell them to Texans, due to state laws banning car manufacturers from selling directly to consumers, according to sources.

Texas' legislature which operates under a biennial system, is winding down its 2021 session on May 31st, after having discussed but not acted on proposed legislation that would have let the automaker sell directly to customers.

This unfortunate digression caused by the state’s pro-dealership laws might result in Tesla shipping electric vehicles (EVs) from its Austin manufacturing unit to other states before they are sold to Texan buyers.

Chief Executive Officer of Tesla, Elon Musk, reportedly said that the company would appreciate a change in the bylaws to avoid such inconvenience.

The proposed law would have permitted all-electric vehicle makers to sell directly to customers in Texas, as long as they weren’t sold through dealerships.

Knowledgeable sources cited that the issue can still be resolved if the state decides to develop a regulatory exception or call a special legislative session, but neither is considered likely, and Tesla will have to wait until the next session in 2023 to push for change.

For the record, laws preventing automakers from selling vehicles directly to consumers have not been targeted at Tesla as the original goal was to prevent manufacturers from undercutting franchised dealerships and putting them out of business.

Tesla and other EV companies have been lobbying in many states to be allowed to sell directly and have had a few recent successes: Tesla and rival EV manufacturer Rivian both have been granted permission to sell in Colorado, and Tesla also found a legal loophole in Michigan. As many as 12 states have allowed EV leaders to sell directly to consumers, while others have let the company open a limited number of dealerships.

Meanwhile, Tesla is facing criticism in China, over a series of users' complaints regarding its braking system after a slew of incidents in the country, cited credible sources.

Source Link –

https://www.theverge.com/2021/5/30/22457455/tesla-texas-factory-law-ship-out-of-state-direct-sale-legislation