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New Jersey Bans Tesla’s Direct Sales, Carmaker Lashes Out on Christie


New Jersey has just become the third state after Arizona and Texas to apply a ban on automakers selling vehicles directly to consumers through their own stores. The New Jersey Motor Vehicle Commission passed the ruling on Tuesday, stating that it comes into effect on April 1. The prohibition means Tesla will have to shut down its existing two locations in New Jersey and sell its cars through franchised dealerships.

The California-based electric carmaker didn’t take the decision lightly and lashed out against lawmakers and New Jersey Governor Chris Christie through a posting on its official website.

“Unfortunately, Monday we received news that Governor Christie’s administration has gone back on its word to delay a proposed anti-Tesla regulation so that the matter could be handled through a fair process in the Legislature,” said Tesla.

“The Administration and the NJMVC are thwarting the Legislature and going beyond their authority to implement the state’s laws at the behest of a special interest group looking to protect its monopoly at the expense of New Jersey consumersm. This is an affront to the very concept of a free market,” the automaker added.

Tesla noted that it was surprised and disappointed by the vote to ban direct sales, as the move comes “in spite of discussions with the Governor’s staff as recently as January, when it was agreed that Tesla and NJ CAR would address their issues in a more public forum: the New Jersey Legislature”. It added that both the company and taxpayers should have been able to participate in the discussion.

Christie spokesman Kevin Roberts told CNN that New Jersey “would press the matter”.

“Since Tesla first began operating in New Jersey one year ago, it was made clear that the company would need to engage the Legislature on a bill to establish their new direct-sales operations under New Jersey law,” said Roberts. “This administration does not find it appropriate to unilaterally change the way cars are sold in New Jersey without legislation, and Tesla has been aware of this position since the beginning.”

Jim Appleton, president of the New Jersey Coalition of Automotive Retailers (NJ Car) and one of the supporters of the ban, said that Tesla should have never been allowed to practice direct car sales in the first place.

“Tesla is a wonderful product but unfortunately, the company has chosen an unwise and in New Jersey unlawful distribution method,” Appleton told CNN.

Tesla said that its not too late for New Jersey to take back, or at least make changes, to the regulation. “We urge the Christie administration to act in good faith and withdraw the proposed amendment, or amend it so that it reflects the true intent of the Legislature and the people of New Jersey.”

By John Halas

Story References: Tesla , CNN & CNBC

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Written by Lewis Shaw

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