Tesla Poised For Triumph In New Jersey, Could Relaunch Sales Next Month

June 9, 2014

In the not-too-distant future, someone is going to make a documentary about electric automaker Tesla. It'll be weightier than the one National Geographic put together, and hopefully, it'll be long enough to cover the many twists and turns along the company's road to success -- including one that Tesla is currently negotiating in the state of New Jersey.


When Tesla launched, many assumed that its biggest obstacle would be technology -- namely, finding batteries that hold enough charge to be palatable to today's drivers and that can be built at a reasonable cost. But in fact, Tesla's major challenges have been in courtrooms and legislatures, as it has fought to upend a business environment that's built around an arguably antiquated, state-by-state system of dealer franchises.

New Jersey has been a particularly contentious battleground. In March of this year, the state's Motor Vehicle Commission unanimously passed new rules that require Tesla to sell its vehicles through third-party dealerships, rather than offering them directly to customers as it has traditionally done. Not one to take things laying down, Tesla and its CEO, Elon Musk, sued the state

To the best of our knowledge, that lawsuit is still working its way through the courts, but a new bill being considered by the New Jersey legislature could allow Tesla to reopen its doors as soon as next month. 

The bill would permit "certain zero emission vehicle manufacturers to directly sell motor vehicles to consumers and require[] them to operate service facilities." Is Tesla among those "certain" manufacturers? You betcha -- it's even name-checked:

"The bill amends current law to allow any [zero emission vehicle] manufacturer to directly or indirectly buy from and directly sell, offer to sell, or deal to a consumer a ZEV if the manufacturer was licensed by the New Jersey Motor Vehicle Commission (MVC) on or prior to January 1, 2014.  This bill provides that ZEVs may be directly sold by certain manufacturers, like Tesla Motors, and preempts any rule or regulation that restricts sales exclusively to franchised dealerships."

Suh-nap. Motor Vehicle Commission, you have been served. 

According to Mashable, the bill was approved by the New Jersey State Assembly's Consumer Affairs Committee, and it could be considered by the full Assembly as early as June 23. After that, it'll go to the state Senate, and it could conceivably be ready for Governor Christie's signature by July 1.


The biggest question at the moment -- apart from when the Assembly will debate the bill and when it might move on to the Senate -- is whether Governor Christie will veto it. Though he often positions himself as pro-business, Christie sided with the Motor Vehicle Commission's new rules that booted Tesla from the state. (Tesla argues that the move was a bit of back-scratching in return for the MVC's donation of $5,500 to his inauguration fundraising committee).

Signing the bill would be a slightly odd reversal for Christie, and it would no doubt anger many of the state's auto dealers. On the other hand, approving it would allow Christie to maintain his pro-innovation veneer and generate some goodwill among the eco-minded -- not a bad move in a blue state like New Jersey.

Which path will Christie choose? How will his decision shape his rumored 2016 presidential run? We'll keep you posted.


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