Amy Wilson
Amy Wilson
Retail, F&I, Porsche Reporter

Tesla is the latest chapter in factory vs. dealer franchise fights

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NEW ORLEANS -- When it comes to Tesla CEO Elon Musk and the franchise system, Connecticut dealer Jeff Aiosa says he's seen this movie before. Manufacturers will keep challenging dealer protection laws, and dealers will keep pushing back.

Like many other dealers I've spoken with here in New Orleans, Aiosa believes that dealer franchise laws will hold up despite Musk's threat of a national challenge and some state-level challenges by the Alliance of Automobile Manufacturers. Musk, who has clashed with dealers in several states over his factory store model, has said he might sue at the federal level or push for legislation in Congress

"Elon Musk is stirring the pot," said Aiosa, a Mercedes-Benz dealer in New London, Conn. "But I don't think it has legs."

Dealers contend that the franchise system offers built-in consumer protections, jobs and tax revenues. And they might need to turn up the volume on that message, they say.

But, says Jim Fleming, president of the Connecticut Automotive Retailers Association, "I think we've got a great story to tell."

You can reach Amy Wilson at awilson@crain.com.

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