Tesla One Step Closer to Its Return in NJ

Tesla is one step closer to making its return to NJ auto markets. On Monday, the NJ State legislature unanimously voted (77 to 0) to re-allow the sale of Tesla’s vehicles in NJ. While the bill still has to be approved by the NJ State Senate, it is positioned to overturn the previous decision that banned the sale of automobiles directly from the manufacturer to the consumer. Many felt that this unfairly targeted Tesla, as it is one of the few automobile companies that follow this model. According to the Los Angeles Times:

Elon Musk, Tesla’s chief executive, is pushing direct sales to consumers because he believes company-owned stores will do a better job than traditional car dealerships selling new technology vehicles such as electric cars.

Car dealers focus on vehicles with gasoline engines, which make up more than 99% of their sales, and won’t take the time to educate consumers about electric cars, he said.

Company-owned stores also enable Tesla to keep control of its sales channel and the marketing process, he has argued.

At the urging of dealers, the New Jersey Motor Vehicle Commission forced Tesla to close two stores this year, reversing a previous decision that allowed the electric car company to sell directly to consumers. Tesla converted the showrooms in Paramus and Short Hills to information centers but once the legislation is approved is expected to resume sales at the sites.

This vote is an important step forward for the consumer in NJ. The re-introduction of Tesla stores to the state, will allow consumers more choice when it comes to what type of vehicle they want to buy. Further, it will allow for the residents of NJ to have more access to energy efficient and environmentally friendly vehicles. With the recent announcement by Tesla that it plans to release its newest model by 2015, this vote appears to be at just the right time for consumers in NJ. Consumers’ Research will continue to monitor the developments in the push to re-allow the sale of Teslas in NJ.

Read More- “Tesla Model X on track to ship; carmaker is winning N.J. dealer fight” (Jerry Hirsch, Los Angeles Times)

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A rising senior at Colgate University, John is currently working as a research fellow with Consumers' Research.

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