Tesla Motors, the rapid rising electric car company recently took a hit in its home turf, as the state of New Jersey banned its practice of direct sales, which skips franchised dealers.
Now, the company, which has been America’s sweetheart this past year, with its value rising astronomically and as it moves to begin expanding its line-up, has decided to contest the ban – saying it interferes with its aim of delivering sustainable transportation and actually favors the old dealer system unfairly.
“Franchise dealers have an inherent conflict of interest in selling electric vehicles,” Tesla said in court papers. “In order to do so effectively, they would need to enthusiastically tout the reasons why electric vehicles are superior to gasoline vehicles. This is not something that they are going to do since gasoline vehicles represent virtually all of their revenue.”
The Palo Alto, California-based electric automaker is fighting across the US with car dealer groups that aim to stop its practice of selling cars directly through stores owned by the company. Besides, New Jersey, Tesla has been banned from selling its cars directly to the customers in Texas and Arizona, while other states – like Ohio or New York encourage the direct sales system.