The Virginia Automobile Dealers Association will appeal a June court decision allowing Tesla Inc. to continue operating a suburban Richmond, Va., store.
The June 21 ruling by Richmond Circuit Court Judge Gregory Rupe means Tesla can keep selling vehicles directly to consumers outside of a state prohibition on automaker ownership of dealerships, VADA CEO Don Hall said in a statement Thursday.
"The law of the Commonwealth exists to protect Virginia consumers and we are appealing the Circuit Court's decision to uphold the integrity of our motor vehicle dealer franchise statute," Hall said in the statement. "The Circuit Court decision allowed the ruling of the Commissioner to stand, but the Judge expressed serious misgivings about the lack of evidence and the Commissioner's decision to allow Tesla to continue to operate in a way wholly inconsistent with the intent of the law and the General Assembly."
Hall added that the law "prohibits the kind of vertical monopolies that Tesla is seeking to erect, a dangerous business model that if left unchecked will leave auto consumers without choice, competition, or reliable service."
Rupe's decision upheld a 2016 ruling by Virginia Department of Motor Vehicles Commissioner Richard Holcomb. Rupe, however, said in his ruling that he had concerns about evidence presented in the case. He also said he was "troubled by the implications of the Tesla business model ... structured in such a way that no independent dealer could ever become profitable."
Tesla did not immediately respond to requests for comment on the dealer association's intent to appeal the June decision. A Tesla spokeswoman in June called Rupe's ruling "a win for consumers who are increasingly looking to purchase electric vehicles."