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State of New Jersey to ban Tesla’s direct sales model after April

Customers in the state of New Jersey will no longer be able to get cars directly from Tesla and will have to rely on dealerships.


One of the key selling points of Tesla cars are the direct ownership model which bars out any middlemen or dealers. Needless to say, this system has been the object of criticism from dealerships and authorities across the country, and the state of New Jersey has now banned this consumer friendly system in the region which could be a massive blow for the company. The ban will come into effect starting from April, so interested customers will have to go out of state to get their desired Tesla vehicle.

Tesla was understandably angry about this turnaround as it claims the government had “gone back on its word to delay a proposed anti-Tesla regulation so that the matter could be handled through a fair process in the Legislature.”

In a blog post, the company further blasted the legislative change.

“The Administration has decided to go outside the legislative process by expediting a rule proposal that would completely change the law in New Jersey,” the company wrote. “This new rule, if adopted, would curtail Tesla’s sales operations and jeopardize our existing retail licenses in the state.”

Tesla has urged the administration to change its stance and reverse the decision, but that is unlikely to happen given the pressure from the NJMVC (New Jersey Motor Vehicle Commission) and the New Jersey Coalition of Automotive Retailers. The issue has been debated in lengths before, but it is obvious that Tesla’s word or even the consumer’s word was not taken into account when making this decision.

Tesla has long known to be a buyer friendly car maker in the U.S. with its range of electric cars, but this news has certainly come as a shock to the public. The manufacturer is looking to embark on a massive expansion plan across the U.S. with ideas to set up manufacturing units across the country, but this news might dampen those ambitions a little. With Texas, Arizona and now New Jersey joining the list, we can possibly expect other states to follow suit in the coming days. So it seems like getting a Tesla in the U.S. might just get a tad harder than usual.

Source: Tesla Blog

Valerie Richardson
26 year old tech writer based in London. Have prior experience working with major media conglomerates. I'm also a lover of all things tech. Well, basically anything with a display and a power button on it.

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