(Updated 2:45 p.m) With Tesla Motors in mind, Senate Majority Leader Bob Duff renewed a push for legislation that would allow electric vehicle makers open up to three retail locations in Connecticut.
Currently, Connecticut law requires that any new vehicle be sold to a consumer by a dealer franchise that is not owned by the manufacturer. Each dealer location must be at least 14 miles away from another dealership selling the same brand.
“The world is changing and Connecticut needs to change with it as well,” Duff said Tuesday at a press conference in his office.
The bill Duff introduced Tuesday is the exact same bill as last year. That bill passed the House 116-32, but failed to get called for a vote in the Senate before the General Assembly adjourned.
Last year, the bill was the subject of vocal opposition from car dealers who said Tesla should be held to the same standards as the rest of the car manufacturers. They believe the franchise system contributes significantly to the local economy and protects consumers.
Elon Musk, CEO and founder of Tesla, wrote in a blog post in 2012 that the reason they did not seek to sell their cars through dealerships was because dealers “have a fundamental conflict of interest between promoting gasoline cars, which constitute virtually all of their revenue, and electric cars, which constitute virtually none.”
The Connecticut Automotive Retailers Association, a trade association that represents car dealers in the state, was not immediately available Tuesday for comment.
However, GM issued a statement in opposition to the bill.
“GM believes that all industry participants should operate under the same rules and requirements on fundamental issues that govern how we sell, service and market our products,” Chris Meagher, communications manager for GM, said Tuesday. “GM opposes the creation of two different sets of laws governing vehicle manufacturers in the state of Connecticut that would establish an uneven ‘playing field.’”
Meagher said Tesla could open a franchised dealership with an independent operator in Connecticut, “but instead they insist that the state must first provide them with unique rules and special exceptions to suit their own business interests.”
Duff said it’s up to the lawmakers to decide if they want to adapt to a changing economy and approve the legislation. He said he understands that car dealers feel threatened, but “I feel that competition is a good thing.”
However, not everyone in the Senate may share that sentiment. Duff said he never talked to his caucus last year about the bill, so he doesn’t know if there was any opposition to it.
Rep. Antonio Guerrera, D-Rocky Hill, who co-chairs the Transportation Committee, said at the end of the day everyone will still be able to do business and consumers will have an option.
He said he understands car dealers that sell other brands of electric vehicles may feel like “we’re infringing on their territory” but “we’ll work together with car manufacturers to make sure every consumer has the option of purchasing a vehicle that they want.”
Jim Chen, vice president of regulatory affairs and associate general counsel at Tesla Motors, who appeared at Duff’s press conference, said the company is eager to invest and expand in Connecticut. He said the three retail locations would involve a $7 to $10 million investment and would hire between a dozen and two dozen people at each location. That’s in addition to the service center Tesla already has in Milford.
Chen estimated that if the company was able to sell directly to Connecticut consumers it would contribute $1.68 million in sales tax revenue to the state.
There are already an estimated 1,000 Tesla vehicles in Connecticut.
Duff emphasized that the legislation doesn’t mention Tesla by name and opens up the market to any electric vehicle company.
“Many companies are interested and Tesla has certainly been at the forefront in this process,” Duff said.
