Rivian Automotive, which assembles its high-end electric vehicles in central Illinois, can continue to sell directly to consumers in the state after a judge dismissed a lawsuit by the Illinois Automobile Dealers Association that also challenged sales by EV startup Lucid Group.
In a Dec. 19 ruling, Associate Judge David Atkins ruled the Illinois secretary of state was correct in issuing dealer licenses to Rivian and Lucid in 2021, as it previously had done for Tesla Inc. The state's dealer association argued that only third-party franchisees may be licensed to sell new vehicles under state laws and regulations.
The ruling, which can be appealed, is the latest challenge by dealer groups to the direct-sales model. Tesla is already the biggest luxury automaker by sales in the U.S., depriving franchised dealers of significant revenue. Rivian and Lucid are now following in Tesla's footsteps with direct-sales models, and other EV makers are preparing to do so, such as Fisker and VinFast.