Can Tesla Sell Cars In Texas

Might Tesla Sell Electricity In Texas Before It Can Sell Cars There

It’s still unclear if Tesla will be able to sell cars directly to customers in Texas when a local factory opens, but the company is now looking to become an electricity supplier in the Lone Star State.

The automaker filed an application with the Public Utilities Commission of Texas August 16 to become a “retail electric provider” , through a subsidiary called Tesla Energy Ventures, Texas Monthly reported Thursday.

On the deregulated Texas energy market, REPs purchase electricity from producers and sell it to customers. Tesla Energy Ventures told regulators that it would use the company’s existing channels, including its mobile app and website, to attract customers, according to TechCrunch.

This adds a new twist to the complicated relationship between Tesla CEO Elon Musk and the state of Texas.

Tesla is building a new factory near the state capital of Austin, and it’s likely to ramp up very soon, possibly this fall. During a financial call last year, Musk said the Texas factory would assemble the Cybertruck, Semi, Model 3, and Model Y for the Eastern half of North America, while the Fremont, California, will continue assembling the Model S and Model X for all markets, plus Model 3 and Model Y vehicles for the Western half of North America, and the promised Roadster sports car.

However, Tesla may not be able to sell the cars it makes in Texas to residents of the state until 2023, at the earliest.

Tesla Cybertruck prototype – Nov. 2019

Are Tesla And Texas A Perfect Match Its Questionable

While its C.E.O., Elon Musk, and the states conservative lawmakers share libertarian sensibilities, they differ greatly on climate change and renewable energy.

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By Niraj Chokshi, Clifford Krauss and Ivan Penn

Teslas move from Silicon Valley to Texas makes sense in many ways: The companys chief executive, Elon Musk, and the conservative lawmakers who run the state share a libertarian philosophy, favoring few regulations and low taxes. Texas also has room for a company with grand ambitions to grow.

Theres a limit to how big you can scale in the Bay Area, Mr. Musk said Thursday at Teslas annual meeting hosted at its new factory near the Texas capital. Here in Austin, our factorys like five minutes from the airport, 15 minutes from downtown.

But Texas may not be the natural choice that Mr. Musk makes it out to be.

Teslas stated mission is to accelerate the worlds transition to sustainable energy, and its customers include many people who want sporty cars that dont spew greenhouse gases from their tailpipes. Texas, however, is run by conservatives who are skeptical of or oppose efforts to address climate change. They are also fiercely protective of the states large oil and gas industry.

Another issue that divides Tesla and Texas is the states law about how cars can be sold there.

Texas Fails To Change Dealership Lawtesla Still Cant Sell Directly To State Residents

Posted by Charles Morris& filed under Newswire, The Vehicles.

For almost a decade now, Tesla has been fighting state governments for the right to sell its vehicles directly to customerssomething which has historically been prohibited in most US states. Texas is one of the states that still forbids direct sales, so residents have had to resort to a workaround some call the Texas two-step. Texans can order a Tesla through the companys web site, but no orders may be placed or processed within the state. The buyer must pay for the vehicle online, and can then pick it up at one of Teslas eight Texas service centers.

Now that Tesla is building a massive Gigafactory in the state, a billion-dollar project thats expected to create at least 5,000 jobs, will the state government reverse its direct-sales ban ?

Not this year. Texass state legislature meets only every other annum, and this year it will end its session without changing its auto dealer franchise laws, as John Voelcker reports in The Drive. This apparently means that, once Tesla begins production at the Austin Gigafactory, any vehicles sold to Texans will have to be shipped out of the state, then shipped back in.

Tesla sure would appreciate changing the law, so that this is not required!

Elon Musk May 27, 2021

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Us Dealerships And Automotive Dealership Disputes

As of September 2020, there are stores and galleriesusually located in shopping mallsin 29 US states and Washington DC. Customers can buy vehicles from stores, as well as from the Tesla website. The stores serve as showrooms that allow people to learn about the company and its vehicles. Some galleries are located in states with restrictive dealership protection laws which prevent discussing price, financing, and test drives, as well as other restrictions. Tesla has set up mobile-shipping-container “stores” and 6 Airstreamtravel trailers each pulled by a Model X, reaching areas not served by brick-and-mortar shops.

Tesla’s strategy of direct customer sales and owning stores and service centers is different from the standard dealership model in the US vehicle marketplace. Tesla is the only manufacturer that currently sells cars directly to customers all other automakers use independently owned dealerships although some automakers provide online configuration and financing. Forty-eight states have laws that limit or ban manufacturers from selling vehicles directly to consumers, and although Tesla has no independent dealerships, dealership associations in multiple states have filed numerous lawsuits against Tesla, to prevent the company from selling cars. North Carolina and New Hampshire sided with Tesla, while Virginia and Texas sided with dealers.

Purchase The Car Through The Website

The only way to purchase a Tesla is through the companys website, as they do not operate any dealerships, and you cannot buy cars from their showrooms. It will be an out-of-state purchase.

When purchasing from Tesla, the site will allow you to pick the nearest service where you can pick it up. The service center will be in the state nearest to you which is not Texas. There is also an option to have the car delivered directly to your residence in Texas.

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Texas Excludes Tesla From Electric Vehicle Rebates Program

Despite having just moved its headquarters to the state capital of Austin to sit alongside its recently opened Gigafactory Texas, Tesla has been excluded from the states electric vehicle incentive program.

Tesla officially made Gigafactory Texas its headquarters in late 2021 in a move that is expected to create at least 20,000 direct jobs and 100,000 indirect jobs over time. But its insistence on selling directly to consumers, avoiding franchised car dealers, still does not go down well.

Texas offers locals rebates of up to $US2,500 for the purchase or lease of electric car in its Light-Duty Motor Vehicle Purchase or Lease Incentive Program

And though the list of eligible vehicles is long and comprises 142 different models from basically every major automaker including 22 models from BMW, 17 from Porsche, 15 from Audi, 6 each from Mercedes-Benz and Volkswagen, 7 from Volvo, and 14 from Ford Teslas name is absent.

The program currently requires that eligible vehicles must be purchased or leased from a licensed new vehicle dealer or leasing company in Texas, says Laura Lopez, a media and community relations manager for the Texas Commission on Environmental Quality, who spoke to The Center Square.

Under Texas law, vehicles purchased directly from the manufacturer or an out-of-state dealer not licensed to sell or lease new vehicles in Texas are not eligible for a rebate.

The current system works well for Texas and Texans.

Where To Get A Tesla In Texas

Texas is one of the four states that prohibits Tesla from selling cars directly to consumers. So can you get a Tesla in Texas, and if so, how? It’s a little convoluted.

First, you must purchase the car online and sign the paperwork. Then, you need to ship the paperwork to the nearest state, where Tesla is allowed to sell cars directly to consumers. Once it’s processed, you have to drive to a Tesla service center in Texas and pick up your car.

Tesla has several showrooms in Texas. These are located in Tyler, Southlake, San Antonio, Plano, The Woodlands, Houston, Dallas, Fort Worth, El Paso, Corpus Christi, Olmito, and Austin. But these are just galleries, and you can’t actually buy a car at a gallery. They can’t discuss the price, but they can show you around the car.

That’s what the law really dictates. Tesla can’t sell you a car at one of its own showrooms. Instead, it can sell you a car remotely or online and deliver it to a service station, or you can drive out to the out-of-state dealer and pick it up yourself.

That way, Tesla isn’t ‘really’ selling you a car directly and delivering it to you in the state. They’re selling you a car out of state and shipping it to a service center, which just makes it available for you to pick up. It’s not delivered according to the law.

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Tesla May Have To Ship Texas

Tesla’s long-running battle with pro-dealership laws is about to create an awkward situation in Texas. The Drive and The Verge report that Texas’ legislature is winding down its session on May 31st without advancing a bill that lets Tesla sell directly to customers. In other words, the EV maker will likely have to ship cars from its upcoming Austin-area Gigafactory out of state before it can sell them to Texans more than a little problematic when Governor Greg Abbott celebrated the factory plans last July.

The state could theoretically call a special legislative session or develop a regulatory exception, but neither is considered likely. The next regular session isn’t due until 2023.

Tesla chief Elon Musk was unsurprisingly unhappy with this, saying his company “sure would appreciate” a change in the law to avoid this workaround. The proposed law would have allowed any automaker to sell directly to customers in Texas so long as the vehicles were entirely electric and weren’t sold through dealerships, opening the door to Tesla as well as competitors like Rivian.

What Can Tesla Showrooms Do

Tesla showrooms aren’t dealerships per se, but many of them can actually sell you a car. Unlike traditional car dealerships, which buy cars at a discounted rate from manufacturers and sell them at a markup, Tesla sales showrooms sell cars directly from the manufacturer to the consumer.

Tesla showrooms are prohibited from selling cars in some states. In these states, you can still pick up a Tesla after buying it, but you usually can’t get it delivered to you directly. Instead, they make you jump through hoops and around import rulesâbut you can still take delivery of your car.

In states where Tesla direct sales are banned, showrooms can do only one thingâshow you the car. They can’t sell it, take it to your house, they can’t negotiate, and they can’t even talk to you about pricing.

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Tesla Will Have To Ship Its Electric Vehicles Made In Texas To Other States Before Selling Them To Texans Because Of State Laws The Drive First Reported

While it works to open a texas factory, tesla still can’t sell cars directly to customers in texasand won’t be able to for some time. They are using their money and lobbying influence to try and prevent that. Not only are there no tesla dealers in texas, there are no tesla dealers in new mexico, oklahoma, louisiana, or even california!

Proposed Texas Bill Would Allow Tesla To Sell Vehicles Directly In The Lone Star State

Texas currently has strict regulations that require all vehicle sales in the state to go through third-party franchised dealerships. That doesnt impact legacy automakers like Ford or General Motors which has an extensive dealership network.

Thats not the case for Tesla. Due to their unique online-only sales model, buyers in Texas can only purchase their new car online, and it must be shipped to them from out of state.

That may soon change as a proposed state law would allow makers of electric vehicles to conduct consumer direct sales in Texas.

The proposed law, House Bill 4379, would recognize EV makers as dealers allowing them to sell cars directly to buyers. The only caveat is the cars in question must never have been sold in Texas before by third-party franchised dealers.

It wont be an easy road ahead as the Texas Automobile Dealers Association is expected to fight any rule changes, just as they have done before.

Many expect this time to be different considering the automaker is currently spending over $1 billion to construct Giga Texas in Austin, creating over 5,000 jobs in the process.

Tesla is also expected to launch their insurance product in Texas soon based on recent filings with the Texas Department of Insurance.

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Where Are Tesla Cars Sold

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âTesla doesn’t use dealerships, which makes getting ahold of one of their cars difficult in some states. So, where can you get a Tesla?

You can get a Tesla at showrooms in any state that allows direct-to-consumer sales or makes an exemption for Tesla. The majority of states don’t have showrooms, and most of these allow you to order one online and have it delivered or pick it up.

In this article, we’ll cover where to get a Tesla in areas where the answer isn’t so clear. We’ll cover state laws that govern direct-to-consumer car sales and go over the states where purchasing a Tesla is unrestricted. Additionally, we’ll cover how to get a Tesla in states where it is restricted.

We sourced some of the information in this article from reputable news sources and from Tesla’s sales center locator page.

TABLE OF CONTENTS

States Where Tesla Can’t Sell Directly To Consumers

In many states, the legality of Tesla selling cars directly to consumers is in dispute in the legislatures, and no concrete conclusion has been drawn.

However, there are several states where the matter is settledâand Tesla is required to sell cars through independently-owned dealership franchises. These states are Texas and New Jersey. Arizona used to be on the list, but the law has since been removed.

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No Texas Rebate For Tesla Buyers

The Texas EV rebate program awards a rebate of $2,500 to the buyers of EVs produced by every major car manufacturer, except Tesla. A total of 142 different models are eligible for the rebate, but not the world’s best-selling EVs: Tesla’s.

When asked why Tesla was excluded from the Texas rebate program, Laura Lopez, the spokeswoman for the Texas department running the rebate program, said, “Under Texas law, vehicles purchased directly from the manufacturer, or an out-or-state dealer not licensed to sell or lease new vehicles in Texas, are not eligible for a rebate.”

While many states that provide franchised new car dealers protection from direct-sales competition made concessions for Tesla, Texas has not done so. State law requires all buyers of new automobiles to purchase through a franchised dealer. If you’re a Texan and you crave a Tesla, you must travel to another state to buy one, or have the sale paperwork processed in another state.

Elon Musk has repeatedly tried to get the Texas legislature to allow direct sales of automobiles. In 2015, while wooing the legislature, he indicated that Tesla might build a factory in Texas. He built that factory and relocated his corporate headquarters to Texas, but the state’s legislature has not acted. None of that seems to have deterred Musk thus far.

The Tesla Gigafactory in Austin, Texas, is now home to the company’s corporate headquarters. Source: Tesla.

Where To Get A Tesla In Arizona

But what about Arizona? State laws are all different, so can you order a Tesla in Arizona like you can in Texas? Yes, and moreâand you can now purchase each Tesla model at one of the state’s many showrooms.

Arizona has three Tesla showrooms in Scottsdale and one in South Tucson. In 2017, the state allowed Tesla to sell cars directly to consumers as they do in California, effectively removing the state from the ‘no sale’ list.

The state figured that residents were just going to nearby California to buy Tesla cars anyway, so why not get the extra tax money and allow residents to purchase them in-state? This seems to be the trend nationwide.

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Tesla Doesn’t Use Franchised Dealerships To Sell Its Evs So They Can’t Be Legally Sold In Texas And They Won’t Get A Rebate

Tesla just recently opened a new factory in Texas, the company moved its official headquarters to the Lone Star State, CEO Elon Musk is living in various areas around Austin and Boca Chica, as SpaceX’s Starbase is located in the latter. Regardless of all of this, Tesla’s vehicles are excluded from Texas’ Light-Duty Motor Vehicle Purchase or Lease Program.

According to Teslarati, Texas’ program covers 142 different models from almost every automaker aside from Tesla. To be clear, we’re not just talking about inexpensive cars either. The list has some 15 Audis, 22 BMWs, 17 Porsches, and many more. The publication even points out that there are a few Bentleys on the list. Obviously, the program isn’t just reserved for fully electric cars, but rather electrified models. A few other low-emissions powertrains are also covered. You can check out the full list by following the link below:

Why is Tesla missing from the list? Texas still doesn’t allow people to legally buy a Tesla in Texas due to franchised dealer laws. Some folks figured that once the US electric automaker opened a factory in the state, the laws might change, but that hasn’t proven true. Meanwhile, Tesla is creating jobs, encouraging people to move to the area, offering to help with the state’s again power grid, and much more.

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