Tesla accelerates efforts to sell cars in connecticut the connecticut story connecticutmag.com electricity wiki


Connecticut residents interested in purchasing a Tesla must travel to Massachusetts or New York, or order one online. Last year, a bill was introduced in the state legislature that would have exempted Tesla from Connecticut’s dealership law. It passed the House by a vote of 116-32 last May before stalling in the Senate, where it failed to come to a vote.

Tesla has revved up its lobbying efforts as the General Assembly prepares to reconvene on Feb. 3. Tesla, and politicians who support the company’s increased presence in Connecticut, hope that a bill similar to last year’s will be reintroduced.

Tesla estimates there are 900 Tesla car owners currently in Connecticut, but the company sees major room for growth in the affluent state where many pride themselves on being environmentally friendly. “Connecticut residents have to drive to New York or Massachusetts, and that’s an inconvenience,” says O’Connell. “They can also buy them online or over the phone, but this is a high-touch purchase. People want to be able to go in and literally kick the tires and drive the car.”

“Granting Tesla a corporate loophole is a risky business and will circumvent long-standing consumer protections and jeopardize local businesses that have operated under these laws in good faith for over 40 years,” he told the committee. He added that the cars are available exclusively to the rich. “If Tesla folds tomorrow, there will be a few hundred people in Connecticut very disappointed, but the holders of most of these cars are your wealthiest one percent, and this is typically their third or fourth car.”

However, after Tesla scaled back its request from five stores to three, Fleming agreed to support last year’s bill because it would be a limited exemption to the state’s franchise law. Fleming’s office did not respond to requests to speak for this story and discuss the association’s stance if a similar bill is introduced this year.

“This does not harm franchise dealers in any way. We operate in this fashion in about 25 different states already, and, to my knowledge, there’s never been a car dealer that’s went out of business because Tesla started selling in that state,” he says. “We encourage car sales wherever we go and, in particular, electric vehicles from other brands because we’re singularly interested in promoting those cars and we’re doing work for some franchise dealers who are selling electric vehicles for other brands like Nissan and Volkswagen and Ford and so forth.”

Rep. Rob Sampson, R-Wolcott, one of the House’s most vocal critics of last year’s bill, opposed it, not because it eroded the state’s dealership law, but because he says it singled out Tesla as the sole exemption to that law. “I probably wouldn’t have supported the car dealers structure as it exists,” Sampson says. “That, in itself, was created by pressure from certain lobbying interests back in the day, and I think the answer would be to start rolling that back so you can allow Tesla and Fisker [Automotive] and anyone else who wants to operate in the marketplace to do so. Instead, they are writing a law that carved out Tesla as an exception and maybe prevented Fisker from being able to operate the same way and the existing car manufacturers couldn’t operate in the same way. It doesn’t make any sense.”

Sampson adds that he is not opposed to Tesla showrooms opening in the state in a different manner. “My issue with the whole thing had nothing to do with Tesla or the auto industry,” he says. “It has to do with the legislature and the power of the state government. The state government should not be deciding which businesses are going to succeed or not.”

Rep. Dan Carter, R-Bethel, a ranking member of the legislature’s general law committee, is one of many Connecticut politicians who support Tesla’s wish to open showrooms in the state. “We have this [dealership] system in place, but there comes a point when if it’s going to keep something from coming to market that’s legitimate, I think we owe it to ourselves as lawmakers to look at the process,” he says. “When we put a lot of rules in place and we protect certain groups, it can stifle innovation.”

Carter likens a potential Tesla Bill to the change in state law last year that allowed bars and restaurants to sell growlers of craft beer. It was a move that Carter believes helped support craft brewers in the state, but which some in the liquor industry opposed.

Named for inventor and electrical pioneer Nikola Tesla, Tesla Motors was formed in 2003 by a group of engineers in Silicon Valley. Elon Musk, the company’s current CEO, came on board shortly after. The company has been dedicated to producing exclusively zero-emission vehicles powered by electric engines.

So far, the cars have not come cheap. The company’s first-generation vehicle had a base price of $110,000, while the second-generation version has a $70,000 sticker price. The prices are coming down, however, and the third-generation Tesla will start at $35,000. It is expected to begin production in late 2017.

Connecticut already has a Tesla service center, in Milford, and O’Connell says the company would like to open at least one showroom in Fairfield County, another in each of the Hartford and New London regions, and potentially one in the Waterbury area. If a new bill is successful, he says the stores could be up and running by the end of the year.