A bill in the Vermont House would allow electric vehicle makers to open direct-to-consumer outlets for vehicle maintenance and sales in the state.
S.47 has been dubbed the “Tesla bill,” because it would open the door for Tesla, Inc. — the California-based maker of a popular line of high-end electric cars — to run its own shops in Vermont through which it could sell and service vehicles directly. Tesla maintains that its cars must be sold and serviced directly by the company rather than through third-party dealers.
Besides allowing electric car makers to open consumer-direct stores, the legislation would place those operations under the same regulations that apply to third-party dealers. It would further bar car companies that don’t make electric cars from opening consumer-direct operations.
Currently, Vermont law does allow electric car makers to operate consumer-direct sales operations in the state. The Tesla bill, however, could allow the company to usher in a new Vermont presence by allowing the automaker to run warranty and service centers in the state, out of which it could also sell cars to Vermonters.
As the House Committee on Commerce and Economic Development took testimony on the bill this week, proponents said the law would make electric vehicles more accessible to residents of a state eager to embrace climate-friendly purchasing habits.
“Tesla views this as a state with excitement around electric vehicles and is frustrated that the law’s oddity has caused delay,” Adam Necrason, a lobbyist representing Tesla, told lawmakers Tuesday.
The Vermont Senate passed the bill March 19, sending it to the House Committee on Transportation. The commerce committee took testimony on the bill ahead of a recommendation it plans to make to the transportation committee on how to proceed with the proposal.
The Vermont Legislature’s consideration of the bill follows years of clashes in other states between Tesla and state lawmakers, auto dealerships, and legacy car manufacturers over the company’s direct-to-consumer sales approach.
Dealers and large automakers argue that one company should not be given special treatment by sales laws, which limit direct-to-consumer car sales in many states. Tesla is currently backing efforts to lift bans on that sales model that have been enacted by other states’ legislatures.
In Vermont, local trade groups representing vehicle dealers and car manufacturers are concerned that the law would adversely affect their business.
“I don’t blame Tesla for not being part of the franchise laws, but this is not fair,” said Chris Grimaldi, a lobbyist for General Motors, in the commerce committee hearing Tuesday. “We see it as giving competitors of ours an advantage over us in this space.”
Some lawmakers, too, are raising questions about offering a single company priority under Vermont’s motor vehicle franchise statute. That law would ultimately be altered if the House passes and Gov. Phil Scott signs the Tesla bill.
When the Legislature amended the franchise law in 2009, it sought to achieve a balance between the needs of manufacturers, customers and dealers, according to Rep. Eileen Dickinson, R-St. Albans.
“What I don’t understand is why Tesla thinks it could operate outside of that,” Dickinson said.
Other lawmakers in the commerce committee appeared torn between whether the bill would help usher in a new era of environmentally friendly vehicles or set a harmful precedent by effectively changing state statute for a single, powerful corporation.
“I’m in conflict with this, because I hate to see us whittle away at some of our car dealerships, some of whom have been here for 100 years,” said Rep. Stephanie Jerome, D-Rutland, another member of the commerce committee.
Rep. Michael Marcotte, R-Coventry, the commerce committee chair, said in an interview Wednesday that a key part of his committee’s recommendation to the transportation panel would be to put a delay on two provisions of the bill dealing with subscription-based auto services and retail sale of parts.
As passed by the Senate, the entirety of the bill would become law upon its passage by the lower chamber and signing by Scott.
Pushing the effective date to July of 2022 for those two provisions would allow lawmakers to more closely consult the findings of an Agency of Transportation study that offers insight on those issues, Marcotte said.
Correction: An earlier version of this story mischaracterized the contents of the House Commerce Committee’s recommendation to the Transportation Committee. The story has also been updated to clarify the nature of Vermont’s existing laws governing direct-to-consumer sales.
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‘Tesla bill’ would allow electric car giant to open direct-to-consumer shops in Vermont - vtdigger.org
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