Tesla cuts deal to keep five N.Y. stores

Tesla Motors (TSLA), New York Governor Andrew Cuomo and the state's car dealers have come to an agreement that lets the electric vehicle maker keep its five company-owned outlets open, so long as it doesn't open any more.

With legislative support, the deal is a bit further along than the one made in Ohio earlier this week, and may presage what's on the way in New Jersey.

Any new Tesla outlets in New York state would have to come under a “strengthened dealer franchise law.”

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Comments (26)
  • Locked Down Investments
    , contributor
    Comments (1558) | Send Message
    This is all a bit farcical as nobody can really stop Tesla from selling direct and shipping cars to customers wherever they live in the USA.
    All they will do with the change in the NJ law is convert their "stores" into "galleries". Only difference being that salespeople in a "gallery" cannot talk about pricing or assist people in placing an order.


    Since everyone who orders a Tesla has to do so via their website this really makes no difference whatsoever.
    There are a few inconveniences such as going through a 3rd party shipper and customers have to handle the registration process themselves but its no big deal really.
    The dealers think they score a victory when a state "bans" Tesla...in reality Tesla will keep on opening "galleries" and service centres countrywide as nobody can stop them from doing so.
    All the dealers score is anger from the consumer who are tired of their greedy corruption of politicians...Tesla's operations aren't harmed at all and they get a lot of free publicity as David fighting Goliath.


    Great job dealers...your days are numbered.
    28 Mar 2014, 10:17 PM Reply Like
  • The Rebel
    , contributor
    Comments (2939) | Send Message
    The IRS targeted Republican groups for excessive scrutiny as is now widely known, with Lois Lerner taking the 5th on two separate occasions. I would imagine that the Treasury Department made similar decisions regarding the auto dealership closures that occurred in 2008 and 2009 re: GM's takeover by the government.


    I wonder how many states have "dealer franchise laws" apart from auto dealerships? Greedy corrupt politicians, indeed! You would think these politicians would welcome a "green" industry such as Tesla. I guess the dealership money they put in their coffers speaks louder than being "green".
    28 Mar 2014, 10:53 PM Reply Like
  • Windsun33
    , contributor
    Comments (4440) | Send Message
    It's NY, not NJ. You can read the entire law here http://bit.ly/O6SxwL


    And the law is useless and insane - as are 90% of the laws in NY. Parts of it are probably unconstitutional, such as "unless preempted by federal law, requires the franchised motor vehicle dealer to waive trial by jury in actions involving the franchisor".


    Though there is a lot of hype saying that the dealers are going after Tesla, that is not true. They are in fact going after preventing direct sales by manufacturers direct to consumers, whether single purchase or fleet. Tesla just happened to be one of those doing so. But just one of the things that makes such laws so stupid is that they are so easy to evade - just get on the internet, order your Mercedes from the factory, and pick it up in the next state over.


    It's all about protectionism and crony capitalism, and Tesla is a minor player and/or victim in it. But considering all the subsidies etc. that Tesla has gotten from the government, perhaps it's Karma :D
    28 Mar 2014, 11:37 PM Reply Like
  • wwt17
    , contributor
    Comments (557) | Send Message
    You would think these politicians would welcome a "green" industry such as Tesla....


    Even more so, you'd think they'd welcome "Made in America" by Americans. They are starting to realize the public backlash is going to be pretty harsh so they are conceding. It is in the nature of these self-aggrandizing buffoons to try to secure their political future and NOTHING MORE!
    29 Mar 2014, 03:05 AM Reply Like
  • TAS
    , contributor
    Comments (4063) | Send Message
    You need to direct your angst against the UAW and Big Three lobbyists. No way is TESLA going to do anymore than small boutique business in the vast majority of the country.


    Sell TESLA to Ford or GM. Make the shareholders a windfall profit and have Musk go on to another venture.


    There is no other political way to succeed.
    29 Mar 2014, 07:17 PM Reply Like
  • David at Imperial Beach
    , contributor
    Comments (4381) | Send Message
    Sorry TAS. Tesla is the way of the future. Ford, GM and Chrysler are dinosaurs and the next time they fail they aren't going to get bailed out. There is a way for Tesla to succeed and that's for the public to get behind them when politicians try to stand in their way.
    30 Mar 2014, 04:53 AM Reply Like
  • Johnny04
    , contributor
    Comments (188) | Send Message
    Lol. Do you know how hard it is to create an electric car and how hard it is to make the model S this successful? If given up is the way to go, they would have given up years ago. This is just a small problem compared to all the things they have been through. There is no way they would give up now.
    30 Mar 2014, 11:18 PM Reply Like
  • Johnny04
    , contributor
    Comments (188) | Send Message
    That's why Tesla is not pushing too hard now. They wait until they have 100k+ owners or when their supply exceeds demand, then they will have tesla car owners occupy the governor mansions and the state assembly buildings until the laws change in their favor.
    30 Mar 2014, 11:24 PM Reply Like
  • joenjensen
    , contributor
    Comments (701) | Send Message
    Hell of a deal, right.....What kind of deal is this anyway, i.e. that Tesla can not open any more stores in NY? Are they afraid of Tesla taking over? Are they afraid that Tesla would win in the end and then they can build as many stores as they want?
    Did the deal include a signed promise not to take this to the Supreme Court? We all know that if Tesla did take this blatant disregard of their rights to sell anyway it can or pleases in our FREE AMERICAN MARKET, Tesla would win hands down in the Supreme Court, and maybe Tesla also knows that if they made that promise they can win in other ways by biding their time?
    All I can say at this point......GOOD LUCK AND GO TESLA.......
    31 Mar 2014, 10:52 PM Reply Like
  • Windsun33
    , contributor
    Comments (4440) | Send Message
    This law has nothing to do with Tesla except for the fact that Tesla happened to be the only mfg currently owning "factory direct" stores at the time.
    1 Apr 2014, 10:36 AM Reply Like
  • microsrfr
    , contributor
    Comments (36) | Send Message
    Every other car manufacturer has contracts with dealers. This puts Tesla in a unique place. Also dealers would push gas cars over electric because electric cars have minimal scheduled maintenance, the major income for the dealers. Tesla has the most effective sales channel for selling electric cars -- GM does not -- witness the sluggish VOLT sales despite 95% of owners indicating that they would buy again.
    28 Mar 2014, 11:53 PM Reply Like
  • Dan Fichana
    , contributor
    Comments (1918) | Send Message
    I can attest to dealers not pushing EVs and even the Volt- some are decent; others not so much-


    The Volt; you really don't want that, you have to make too much to get the tax rebate... How about this cadillac?


    You know it does't handle well in the winter, battery life goes down


    Those 2 things were said by a GM dealership !


    Now this was said at a Ford dealership when looking at the Cmax and indicated that the Volt was also on our list. "You know the Volt is a flop, it cost the government $700,000 to make each one".


    Hence, why my wife has neither of those now.
    29 Mar 2014, 12:57 AM Reply Like
  • a alto
    , contributor
    Comments (365) | Send Message
    Vote them out !
    29 Mar 2014, 08:06 AM Reply Like
  • wwt17
    , contributor
    Comments (557) | Send Message
    The problem is, when it comes time to vote, we have to choose between to P.O.S! It's a no-win situation for the public when you have to choose the lesser of two evils. This is always the reason I like to punch people in the face when they say, "If you don't like him/her why did you vote for that person. You had a choice." No, a choice between two scumbags isn't really a choice.
    29 Mar 2014, 09:10 AM Reply Like
  • Leftfield
    , contributor
    Comments (4070) | Send Message
    "No, a choice between two scumbags isn't really a choice."


    Except, if there is no solid reason to return an incumbent, the opponent should get the vote. Sadly, the public responds like trained monkeys to name recognition, and corrupt crony sellouts cements the 95%+ incumbent reelection rate that guarantees that the same old tricks will continue for the next term, every time.
    30 Mar 2014, 01:30 PM Reply Like
  • Locked Down Investments
    , contributor
    Comments (1558) | Send Message
    So perhaps the solution is...vote Elon Musk into power!
    I firmly believe he will run for office one day...and he would certainly have my vote.
    31 Mar 2014, 07:45 AM Reply Like
  • Vico Confino
    , contributor
    Comments (249) | Send Message
    This message is brought to you by clairvoyant Vico Confino


    Stay strong Elon.
    I have seen the future and sunshine will eventually melt all ICE vehicles.


    Has anyone heard the rumor that New York dealerships have banded together to
    block the sun from shining over their State.
    29 Mar 2014, 09:30 AM Reply Like
  • Cassina Tarsia
    , contributor
    Comments (662) | Send Message
    I think that Elon will one up the states some day by going federal ... but he has to be careful here ... it could backfire unless he has all his ducks in order first! All it takes is one bill in the U.S. Congress ...
    29 Mar 2014, 11:21 AM Reply Like
  • justaminute
    , contributor
    Comments (1925) | Send Message
    Only if citizens are stupid enough to let the Feds run everything.
    29 Mar 2014, 02:41 PM Reply Like
  • Johnny04
    , contributor
    Comments (188) | Send Message
    That's why he doesn't act now. He waits for all his ducks to line up.
    30 Mar 2014, 11:41 PM Reply Like
  • deercreekvols
    , contributor
    Comments (9849) | Send Message
    NY Governor Cuomo will do anything and everything possible to keep his name in the spotlight.


    Residents of New York know all about this politician and how he is using NY as a springboard for a Presidential run.


    What a joke of a governor and the damage done to NY under his watch will take decades to erase, if it can be erased.


    Just my opinions on my governor.
    29 Mar 2014, 11:56 AM Reply Like
  • NotAFanBoy
    , contributor
    Comments (7) | Send Message
    One problem that is real, and exists in other places like Texas as well where I live, is that we cannot lease the car.
    30 Mar 2014, 05:38 AM Reply Like
  • BigRed64
    , contributor
    Comment (1) | Send Message
    Free trade? What free trade?
    30 Mar 2014, 05:39 AM Reply Like
  • Seth Walters
    , contributor
    Comments (675) | Send Message
    Politicians understand that they are just like used car salesmen, and as such, they must stick together.
    30 Mar 2014, 12:24 PM Reply Like
  • omarbradley
    , contributor
    Comments (966) | Send Message
    "former tech hub New York State agrees keeping tech out is the way to go." no news there. should be interesting to see how this all "blows over" City way. The inventory just laying around up here is quite amazing actually...and if there is no war that steel will just sit there and rot.
    30 Mar 2014, 02:03 PM Reply Like
  • Doc's Trading
    , contributor
    Comments (1847) | Send Message
    TSLA.... Articles in Barrons this weekend.... One negative..."Gigafactory Catch"... one positive.. Momo stocks will rise again....
    I have no conclusion as to which outways the other.
    30 Mar 2014, 05:15 PM Reply Like
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