Tesla Rebuffs Texas Dealers In Bid For Direct Sales


Last year Elon Musk left the Texas legislature with his tail between his legs as the entrenched car dealer lobby prevented any direct sales bill from ever coming up for vote. Dealers did however approach Musk about selling Teslas through their dealership networks, and according to the Texas Tribune, they were denied as the EV entrepreneur gears up for another fight.

Despite a strict sales ban that prevents salespeople from offering test drives or even discussing pricing, there are about 1,800 registered Tesla Model S owners in the Lone Star State. The new car market in Texas is second only California, and it is also one of the most sustainably-powered states thanks to growing reliance on wind and solar energy. Breaking into the Texas market would be a major move for Tesla, as the hoops would-be owners have to jump through has almost certainly dissuaded a few would-be buyers.

That’s because Texas has one of the country’s strictest car sales laws, as any new car must be sold through a franchised dealership. Some legislators have proposed a hybrid system, where after 5,000 sales Tesla would have to start issuing franchises, but Musk seems determined to be able to sell his cars his way. To that end, Tesla will be upping its lobbyist spending in Texas. In 2014, Tesla spent between $170,000 and $370,000 on lobbyists, but this year the automaker will spend at least $625,000 and as much as $1.18 million to convince the state legislature to allow a direct sales setup. He will also pitch a hyperloop test track and a possible Tesla factory expansion…one day.

It won’t be easy though, as the Texas Auto Dealers Association has been contributing hundreds of thousands of campaign and lobby dollars every year to getting the laws just the way they like it, and it’s not like dealers are just going to roll over for Elon Musk. Will Musk get his way, or are Texas car dealers too deeply entrenched to uproot?

Christopher DeMorro

A writer and gearhead who loves all things automotive, from hybrids to HEMIs, can be found wrenching or writing- or else, he's running, because he's one of those crazy people who gets enjoyment from running insane distances.