State Republicans Back Direct Auto Sales in Texas

By David Cawton
Tuesday, May 24, 2016 at 10:06 PM EDT

  Click to view Public Blueprint's CEO discuss Direct Sales on Time Warner Cable News

Click to view Public Blueprint's CEO discuss Direct Sales on Time Warner Cable News

AUSTIN, Texas - If you want to purchase a Tesla in Texas, you're going to have to be persistent.

You could head to a showroom and check out the Model S in person, but if you want to talk numbers, you're out of luck.

"You would have to go online, or call California and buy that car. It gets registered in California and shipped here," says David White with Tesla in Texas.

White said that's because state law essentially slams the door on Tesla's business model of direct auto sales.

In Texas, manufacturers aren't allowed to sell cars to customers directly.  That's a problem for companies like Tesla, which doesn't have traditional dealerships.

"If [customers] want to go to a dealership to purchase a vehicle, that's great, they should do that. But if they'd like to go to a manufacturer to do that, they should be able to do that as well," added White.    

Lawmakers in both chambers of the Texas Legislature failed to pass bills that would have allowed direct sales, the past two sessions. Most of the opposition came from groups like the Texas Automobile Dealers Association.

In a statement to TWC News, TADA President, Bill Wolters told us:

"Texas legislators got it right the first time. Current Texas franchised automobile dealer laws protect competition and consumers."

White said the issue isn't all bad for Tesla. His group did get the green light from state Republicans recently at their party's convention. They pledged to support the idea next session in their official party platform.

William Crocker, the former General Counsel for the Republican Party of Texas was one of the few delegates asking his party to pump the breaks on behalf of auto dealers.

"It's regarded as the camel's nose under the tent again," said Crocker.

He added, "The existing dealers regard that as the beginning of other manufacturers having an opportunity to do the same thing."

Crocker said Tesla shouldn't get special treatment. Instead the electric car company should stay in the same lane as other dealers.

White maintains that Tesla is taking a new route on behalf of all manufacturers who want to connect with their customers.

Both agree the fight will continue in the next legislative session, which starts next year.

White maintains that Tesla is taking a new route, and he says it's about giving consumers a choice.

"It's not just about Tesla, it's about all manufacturers," said White.

Whether lawmakers will agree has yet to get the green light.  

PUBLIC BLUEPRINT