Texas Lawmakers Make Second Attempt To Legalize Tesla Sales

Texas lawmakers are debating a set of bills that would allow Tesla to sell its electric vehicles directly to Texans.

The proposal has been sent to state legislators under two different bills. Reps. Eddie Rodriguez, Jodie Laubenberg, Rod Simmons and Tan Parker co-authored House Bill 1653. Sen. Kelly Hancock sponsored a second and identical proposition, State Bill 639.

If the bills pass, car manufacturers will be able to receive a dealer’s license and sell vehicles directly to customers, but there are a few caveats.

First, the carmaker must have never sold vehicles in Texas before using a franchise dealership. In addition, the law only allows the manufacturer to open up to 12 stores in the state.

“Free market principles are the foundation of our strong Texas economy,” said Sen. Hancock. The bill “helps sustain a competitive marketplace and gives consumers more choices.”

The majority of Texans agree. After 1,200 adults were surveyed last month about buying a car from the manufacturer, 84-percent support the idea.

SEE ALSO: Letter To Legislators From 10 Organizations Backs Tesla Against Dealers

And they aren’t alone. Earlier this month, 10 organizations signed a letter in support of Tesla-direct sales. The letter, which included endorsement by Sierra Club and the Koch brothers, was sent to state leaders and governors around the country.

“Tesla’s market entry through direct distribution is providing consumers with beneficial new choices on what vehicles they buy and how they buy them,” said the groups in the letter. “Moreover, our concerns are not limited to Tesla, as these laws have similarly negative effects on any company seeking to distribute their cars directly to consumers.”

Despite support from these organizations and even the majority of constituents, the opposition isn’t wavering.

SEE ALSO: Tesla Gets Planning Commission Approval for San Antonio Store

“It is a bad idea for our state,” said Bill Wolters, president of the Texas Automobile Dealers Association.

“When you buy a product from a retail outlet owned by a California corporation, 100 percent of proceeds from the sale go to California. Nothing goes to Texas. There’s no real benefit for our state.

“[Auto dealers are] a part of the community. They focus on customers, employees and their town because they want to be there for generations,” said Wolters.

Two years ago, a similar bill was sent to Texas lawmakers, but wasn’t able to gain enough support to pass. If the current HB 1653 and SB 639 do not pass, Tesla will have to wait another two years when the legislature reconvenes in 2017.

Automotive News