Earlier this year, Michigan Gov. Rick Snyder announced a new marketing campaign for Michigan, akin to the successful Pure Michigan tourism campaign. Called “Planet M,” the economic development program aims to demonstrate how the state is leading the way in mobility r&d.
Which is great, unless you happen to work at a company that doesn’t play by the established auto industry rules. And then the state’s protectionist ticks are exposed.
Snyder, who once championed direct-to-consumer computer sales when he was COO at Gateway, told Automotive News on Wednesday that electric-car maker Tesla needs to make a case for why it should be able to open its own direct-to-customer showrooms in Michigan.
Tesla filed a lawsuit in federal court last week saying Michigan’s 2014 law banning direct sales of vehicles to consumers violates Tesla’s constitutional rights. Michigan is the most populous state to ban Tesla stores, showrooms and service stations.
After closing the door on those sales, Snyder wrote a letter to the entire state House of Representatives, encouraging them to have “a healthy, open discussion” over whether “the current business model in Michigan should be changed. This discussion should consider, first and foremost, what is best for Michigan consumers, for expanding economic activity and for innovation in our state.”
He also pointed out that the bill doesn’t ban Tesla from selling cars in Michigan, but just clarifies that cars must be sold through a franchised dealer.
But Tesla’s lawsuit is not what he wanted to talk about, Snyder told our reporter. He wanted to talk about mobility, which he defines as intelligent vehicles, lightweight materials and propulsion systems.
How one argues that electric-car maker Tesla isn’t part of the bigger mobility discussion is puzzling, even using Snyder’s definition. Tesla is a leader in autonomous driving. It uses aluminum and carbon fiber in its vehicles. It has installed its own nationwide network of fast chargers. It is pioneering the use of over-the-air software updates.
And yet. You can’t buy one in the state of Michigan, aka Planet M.
On Planet M, our car dealerships are closed on Sundays in all the populous areas of the state, thanks to decades-old traditions designed to observe Blue Laws. We pass legislation permitting companies to test autonomous cars in our state, but write the language carefully so it only allows for established car manufacturers to test here and potentially blocks companies like Google and Apple from using roads.
As Diarmuid O’Connell, vice president of business development at Tesla, pointed out, franchise laws were designed to protect franchise owners from abuses from the franchisor. They were not intended to block out an entire company from doing business in the state.
“Michigan was the birthplace of the auto industry in the United States,” O’Connell said, after comparing the franchise rules to something seen in communist China or socialist France. “It should be the vanguard of the movement.”
Agreed. If Michigan wants to be taken seriously as a center of future automotive innovation, then the franchise law needs to be amended to allow Tesla into the state.