Tesla: wrong move, New Jersey

Tuesday afternoon the New Jersey Motor Vehicle Commission passed new rules prohibiting Tesla from selling vehicles directly to its customers in the state, despite the fact that two Tesla stores were previously granted licenses and have been operating within the Garden State’s borders for over a year. The sides seem to disagree on who is in the wrong: Gov. Chris Christie’s office insists that Tesla would have to properly seek legislative change to allow its business model and that Tesla knew this from the start.

Tesla has effectively called bull on this statement, as Diarmuid O'Connell, Vice President of Business Development at Tesla, had this to say: "The statute in New Jersey plainly allows Tesla to be licensed to sell cars there. Indeed, the Motor Vehicle Commission has licensed Tesla under that statute ever since October 2012, and any suggestion that Tesla was told 'since the beginning' about any problem with its ability to be licensed there is false. The only thing that has changed is the Christie Administration's sudden decision to go around the Legislature in an attempt to enact a rule that the statute doesn't permit. Worse, it has done so without any reasonable notice or even a public hearing."

So who are you more inclined to believe, the politicians or the upstart car company trying to change the world for the better? I’m leaning toward Tesla. It sounds like New Jersey rushed this rule change through with little warning before people in the state, and particularly Tesla owners, knew what was happening.

In addition, the argument offered by the New Jersey Coalition of Automobile Retailers president Jim Appleton effectively makes Tesla’s case for them. In claiming that Tesla’s business model is not innovative (which, it almost goes without saying, is far from the truth) Appleton implied that dealerships "promote greater access to warranty claims and safety recall service, which are both something manufacturers hate.”

I’ve got news for you, Jim: Tesla is not your typical manufacturer. They sell vehicles that deviate completely from the old internal combustion paradigm and are brimming with innovation and new technology, which means they require a different model for sales, education, and service. Good luck finding a dealer anywhere in the United States that offers service for electric vehicles that comes close to comparing with Tesla; the jury is still out on warranty claims since the vehicles are so new, but Tesla has already proven that the word “recall” barely even applies to them, as they can and have performed most upgrades wirelessly a la Apple software updates.

New Jersey, you didn’t make the right choice. Banning Tesla accomplishes nothing but appeasement of those who benefit from the deeply flawed status quo. You can be sure that Tesla owners and supporters will be letting Governor Christie’s administration know about it.