If you're in NJ, please come support Tesla at the NJ Motor Vehicle Commission HQ Tues at 2p. 222 E State St., 8th Floor East Wing in Trenton
— Tesla Motors (@TeslaMotors) March 11, 2014
While Elon Musk is betting that history is on his side, his toughest battle may not be persuading mainstream Americans to buy an electric car, once Tesla makes a model that's affordable enough. Musk's biggest obstacle to dialectical nirvana might well be the New Jersey auto dealers' association.
The economic might and political clout of traditional car dealers stand as the background reasons why the administration of New Jersey Gov. Chris Christie got tough with Tesla this week and blocked the brand from direct auto sales in the state. Tesla said that it may have to close its only two stores in the New Jersey market, which of course is crucial for feeding the EV appetites of high-net-worth residents throughout metro New York City.
New Jersey auto dealers subverting democratic process to try to block Tesla sales http://t.co/PLY97W1oh0
— Elon Musk (@elonmusk) March 11, 2014
"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 Kevin Roberts, spokesman for Christie, according to Bloomberg.
In addition to posting an outraged blog post, Tesla responded via its VP of business development and said that the decision "was made rather abruptly and certainly without any consultation with us. There are probably a couple levels of bad faith and surreptitious behavior."
Regardless, for now Tesla is stuck with the decision. It is only one of many battles that the brand has been waging, in states around the country, to clear the way for a direct-sales model at dealerships that is as revolutionary to the industry in some ways as the battery technology in the Tesla Model S and the success of the $71,000-and-up car in the US and global marketplace.
Texas and Arizona are among the states where Tesla is fighting this battle despite the fact that Musk identified those two locations -- plus New Mexico and Nevada -- as the four states with the potential to land the huge battery-making "gigafactory" that he wants to build.
Auto dealers are independent business owners and some of the savviest and most resourceful entrepreneurs in the world. Many own sports teams and industrial titans and other enterprises as well as their auto dealerships; many own chains of dozens of car outlets. And they haven't taken kindly to previous attempts to break their monopoly on how cars are retailed in the United States. As Forbes.com noted, they may prove Musk isn't Iron Man after all.
Major established automakers tried to break that hold several years ago and failed, and now even the car brands' online sales all are siphoned through their dealership networks.
Could Musk ultimately prevail? It's possible. But it may be more likely that he focuses on advancing a brand and products that have accelerated quickly into the global consciousness and at some point in the future just decides to sell Teslas as every other vehicle is sold. And that would be just fine with New Jersey auto dealers.
Source: brandchannel.com
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