Texas dealers argue against altering franchise laws to lure Tesla plant

TESLA V. DEALERS
TESLA V. DEALERS
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Texas dealers defended the state’s franchise laws today, just days after Gov. Rick Perry suggested that the laws should be reviewed and perhaps changed to let Tesla Motors sell its electric vehicles directly to consumers.

The Texas Automobile Dealers Association today sent an open letter to all members of the Texas Legislature arguing that Tesla should not get special treatment. Texas franchise laws prohibit direct sales by any manufacturer. Earlier in the week, Perry suggested reviewing the laws in light of the possibility of Texas’ snaring a $5 billion battery factory proposed by Tesla.

“Tesla’s a big project,” Perry told Fox Business News. “The cachet of being able to say we put that manufacturing facility in your state is hard to pass up.”

Tesla has named Texas, Arizona, Nevada and New Mexico as finalists for the battery factory.

Dealers said the battery factory shouldn’t make a difference.

“We do not believe, however, that economic development efforts to bring any business to Texas should in any way be connected to changing established laws in Texas for the singular benefit of any one company,” read the letter, signed by Rick Cavender, a San Antonio dealer and chairman of the dealers association. “We believe this sets a bad precedent for future economic development efforts by linking them to special interest changes in the law.”

Even if legislators want to change the law, the Texas Legislature has no general session scheduled this year. A Perry spokeswoman said this week that the governor has no plans to call for a special session on the Tesla matter.

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


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