Tesla Won’t Be Able to Sell Electric Cars in NJ Come April 1

March 13, 2014 | Law & Public Safety, Politics
Motor Vehicle Commission passed regulations prohibiting manufacturers from directly selling cars to customers.

By Lauren Wanko

Bernardsville resident Richard Walker is considering buying a Tesla electric car, but he worries he’s running out of time to make the decision.

“I went out of my way to come here and look at this, for fear it wouldn’t be here very long,” Walker said.

That’s because Telsa sells its cars directly to the consumer and the Motor Vehicle Commission unanimously passed new regulations requiring that cars sold in New Jersey be sold through a franchised dealer, not directly from a manufacturer. A New Jersey Motor Vehicles Commission spokesperson tells NJTV News that’s already required under state law, but the agency’s regulations were a bit ambiguous so the commission decided to change the language of the regulations to mirror the state law.

“I was taken aback when I read that decision. To send somebody away is kind of an unusual decision when we’re trying to promote green energy, green opportunities,” said Senate President Steve Sweeney.

Tesla Motors declined our request for an interview, but issued a statement saying they were surprised by the vote and calling the regulation “anti-Tesla.”

That’s a claim denied by the governor’s office. Christie Spokesperson Kevin Roberts tells NJTV News 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.

New Jersey Coalition of Automotive Retailers President Jim Applegate says the regulations aren’t intended to put Tesla out of business.

“These regulations are simply an implementation of long-standing statutory prohibitions in the state which prohibit an auto maker from owning a dealership, from being licensed as a new car dealer or from directly retailing cars to consumers,” Appleton said.

Appleton says the state has a compelling interest in promoting price competition.

“The Tesla factory-owned model crushes competition and ensures they will control the price of the vehicle and that consumers won’t have the opportunity to shop around,” said Appleton.

Still, in a Tesla store, customers disagree with the regulations.

“I think the government is stepping into something they shouldn’t be involved in,” said Westfield resident Richard Griggs.

“The state has no business fooling around with this kind of issue, when the manufacturer ought to be able to decide for himself,” Walker said.

Tesla sells their cars in two different locations in New Jersey — one at the mall in Short Hills and another store at the Garden State Plaza Mall in Paramus.

The new regulations go into effect April 1.