State of Iowa Tells Tesla To Cancel Its Scheduled Test Drives

puddingebola writes: Conflict continues between state governments and Tesla. From the article: "Iowa joined a growing list of states tussling with Tesla Motors' business model when it told the company to cut short three days of test drives earlier this month in West Des Moines. The Iowa Department of Transportation said the test drives were illegal for two reasons: Tesla isn't licensed as an auto dealer in Iowa and state law prohibits carmakers from selling directly to the public." While the article touches on the legal restrictions on selling cars in Iowa, it seems that Tesla was only providing test drives.

Comments

Rent a Tesla for $1

[istartedi]

Rent a Tesla for $1. This is a one-time offer. Limit one per customer. Problem solved.

Re:Rent a Tesla for $1

[Frosty Piss]

Rent a Tesla for $1. This is a one-time offer. Limit one per customer. Problem solved.

I like this idea, but there must be some reason that Tesla is not doing it. Also, I think Tesla should focus on breaking these absurd laws. Tesla has shitloads of cash available from its founder, Tesla should take a "scorched earth" approach and start suing, and take all the way up.

Re:Rent a Tesla for $1

[plopez]

How about "Come to an Educational event intended to raise awareness of the possibilities of electric vehicles". Throw in a few displays of photos of how the technology works and perhaps including a historical perspective on electric vehicles and the problem is solved. No more test drives, but rather "hands on learning demonstrations".

Re:Rent a Tesla for $1

[geoskd]

You forget that this is a democracy. If the laws are wrong, petulance isn't really the answer.

We don't live in a democracy, and never have. Until and unless we have a real democracy, "By the people, for the people and of the people" is just a pretty fiction designed to keep the sheeple in line. The only way this will ever change is through aggressive "petulance"

Re:Rent a Tesla for $1

[ShanghaiBill]

the whole dealer thing was to protect the consumer from purchasing a vehicle and not having any support for it.

Not true. It was to prevent manufacturers from running their own dealerships, which would have, arguably, provided even better service. My experience is that a dealership is the worst place to get your car serviced. Almost any independent mechanic will do a better job for less money.

expect an influx of inexpensive vehicles from SE Asia with no means of warranty repair or service.

... except for the tens of thousands of independent mechanics, garages, and body shops.

is it a good idea for the masses to be purchasing vehicles from Amazon?

Yes. They would likely get a better purchase price, and better quality service than from the existing rigged cartel.

Re:Rent a Tesla for $1

[Frosty Piss]

Properly targeted campaign donations would almost certainly be more cost effective.

Apparently, they are not doing this or it isn't as effective as the money from local business?

State and local politicians know who elects them, and it ain't Elon Musk.

The courts are the only way for Tesla out of this bullshit.

Re:Rent a Tesla for $1

[AK Marc]

As popular as it is to make this gripe this country was founded on democratic process.

Yes, a "democracy" where only rich old white men could vote.

Re:Rent a Tesla for $1

[AK Marc]

That's illegal. If a warranty place is not convenient, you have the right to pay a mechanic to do the work, and collect from the manufacturer for the repair.

Where are you where it's not allowed to get warranty work covered under warranty from a 3rd party? There may be some places in the US where you couldn't claim lack of access to an authorized shop, but that doesn't change your rights and their responsibilities.

Re:Rent a Tesla for $1

[Aighearach]

... except for the tens of thousands of independent mechanics, garages, and body shops.

I don't know about your area, but here, warranty work is handled only at a dealership.

So if there are cars that don't have significant warranty service, but are so much cheaper they can still compete, then there is no problem there. Warranty isn't a free lunch, it is something that a minority of car buyers pay for. (most people buy used cars with no warranty, or buy a new car and keep it past the warranty)

This isn't like a "lemon law" situation where buyers are being "taken for a ride," this is a simple matter of competition where there is no accusation of confusion or fraud.

Re:Rent a Tesla for $1

[PopeRatzo]

As popular as it is to make this gripe this country was founded on democratic process.

No. You could say that our Constitution was designed as a counter-revolutionary reaction to the Articles of Confederation, designed to keep any important decisions out of the hands of ordinary citizens. It's "democratic" in the sense of people being able to vote, but everything from the electoral college to the Senate to the Supreme Court were designed as safeguards against the will of the people.

There were democratic movements in various eras in the US, the most recent being in the decades after WWII when women and blacks both had the right to vote, but everything today is pointing away from "the Will of the People". From our legal system which every year creates millions of adults who cannot vote to the new spate of voter suppression efforts in Red states throughout the country to the recent movement by conservatives to repeal the 17th Amendment, which allows for the direct election of the Senate. Even the recent Citizens United opinion was designed to reduce electoral participation. When it's clear that a handful of the richest donors control the electoral process from school boards all the way up to the Presidency, why bother voting?

Nosirree. We were not founded as a democracy. We've been something other than democratic from the day the Constitution was ratified, not by popular election, but by a group of wealthy white slave-owning men. "Democracy" is a fairy tale we tell school children in the hope that they'll someday enlist in the military and be willing to go die in some foreign hellhole to protect the assets of the wealthy.

Re:Rent a Tesla for $1

[ShanghaiBill]

I don't know about your area, but here, warranty work is handled only at a dealership.

Not for Tesla cars, because there are no Tesla dealerships. There is no reason that warranty work cannot be done by any qualified mechanic.

Re:Rent a Tesla for $1

[DNS-and-BIND]

Ah, yes, the familiar left-wing argument. The day that we have a "real democracy" is the day the left-wingers remove our ability to make decisions. Because, you know, none of us voters are qualified to make decisions. It's much better to trust the Socialist Party to make those decisions for us. They're better people, more intelligent, have Ph.D.s. Can you imagine what a nation would look like if the great unwashed made decisions that benefited themselves? Anarchy! Better to live in the "real democracy" - the one that better-qualified people decide we should have.

Re:Rent a Tesla for $1

[danbert8]

I agree, claims of voter suppression and racism are bullshit. Is it suppression for all the other things that require ID in the modern world? I hope you never have to fly, buy alcohol, medicine, cash a check, or do anything else either.

As far as us being a democracy, our founding fathers had a healthy fear of it. The direct election of senators for sure messed up the system of government. If we want only representatives elected by the people, just drop the senate altogether. The house already represents the will of the people. The senate was supposed to represent the states, and now it doesn't... It represents the people, but in a horrible proportion unlike the house. In what world does that make sense?

Re:Rent a Tesla for $1

[PopeRatzo]

Is there any count of how many people do not pay taxes, receive no government assistance, have no permanent mailing address, are completely off the grid yet somehow qualify as a registered voter and manage to get to the polls every two years yet seem to disappear after that. Who are these people?

In fact, there is a count. There have been investigations into voting fraud in every state and at the Federal level by both Republican and Democratic administrations. The number has never been more than a handful.

So to answer your question, "Who are these people"? They are the people who live in your imagination and the imagination of AM radio talk show hosts.

The Voter Fraud Myth:

http://www.newyorker.com/magaz...

Re:Rent a Tesla for $1

[Kijori]

I agree, claims of voter suppression and racism are bullshit. Is it suppression for all the other things that require ID in the modern world? I hope you never have to fly, buy alcohol, medicine, cash a check, or do anything else either.

I think that the point is that:
1. Black, hispanic and asian voters are significantly less likely to possess ID that is sufficient to meet the requirements of the laws. They are also less likely already to be registered to vote.
2. Election fraud is rare, and in-person fraud (the only type that could be prevented by these laws) is vanishingly rare.
3. These laws are being passed by Republican legislatures. Statistically, reducing the number of black, asian and hispanic voters is likely to improve their results in elections.

So what you have is a measure that claims to prevent a problem that doesn't exist, and, coincidentally, will make it harder for the party's opponents to vote.

I don't actually believe that that is a coincidence. I don't know whether it is racist or not, but I do think that elections should be fought by trying to convince the electorate that you are the best candidate, not by changing the procedure to make it harder for your opponents to vote.

Re:Rent a Tesla for $1

[RockDoctor]

Tesla probably has the ability to fight and win outright.

Though that may take 20 or 30 years.

The "old boys' club"

[Chas]

The sooner Tesla breaks open this idiotic "members only" crap, the better.

I'm not saying dealers don't provide a valuable service. Or that they didn't provide protections to consumers at one time.
The fact is, one angry consumer, TODAY, has orders of magnitude more power to make an automaker acknowledge a grievance than we EVER had in the past.

One nasty little YouTube video can, potentially, reach millions of consumers.

Wheras 80 years ago, if Joe Blow in Podunk, Idaho got shafted, what was he gonna do? Drive to Detroit and crash the gates?

Re:The "old boys' club"

[7213]

"Tesla is getting legislated out of existence in most places."

Please explain.

The laws denying auto manufacturers from selling directly to consumers are ancient & GM blamed them too some degree for their bankruptcy back in 2008.

There are also laws forbidding movie studios from owning movie theaters, based on similar reasoning.

These aren't NEW, they aren't getting 'legislated out of existence' they failed to build a business model that fits the current laws. Either they modify their model & sign up dealers (boo!) or continue to fight this in court (hooray!).

Re:The "old boys' club"

[lakeland]

Er, yes, of course it is. Tesla is not an Iowa company. Iowa customers are. When they buy off Tesla, that's an interstate commercial transaction.

it's pretty damn hard for a state like iowa to tell Tesla what they're doing is illegal when Tesla can point to a federal ruling that preventing car manufacturers selling cars to the public is legal. Until Tesla have that ruling all they can point to is legal opinions which carry a lot less weight.

Re:The "old boys' club"

[__aaltlg1547]

The State is right. Tesla is breaking the law:
Iowa Code 322.3.1 A person shall not engage in this state in the business of
            selling at retail new motor vehicles of any make or represent or
            advertise that the person is engaged or intends to engage in such
            business in this state unless the person is authorized to do so by a
            contract in writing with the manufacturer or distributor of such make
            of new motor vehicles and unless the department has licensed the
            person as a motor vehicle dealer in this state in motor vehicles of
            such make and has issued to the person a license in writing as
            provided in this chapter.
Iowa Code 322.3.14. A manufacturer or importer shall not directly or indirectly
            be licensed as, own an interest in, operate, or control a motor
            vehicle dealer. "

You need to change the law first, THEN you can sell cars legally. Were I in Iowa, I wouldn't buy a Tesla. There's a risk that it may be impounded as evidence in a case against Tesla.

Re:The "old boys' club"

[The Raven]

Not quite. See, they were not selling. They were advertising. This is similar to Harley taking their new electric motorcycle around to events to show it off. There is no law against letting people drive your car. People who liked it enough could drive to buy it in the next state over.

Re:The "old boys' club"

[AK Marc]

GM blamed them too some degree for their bankruptcy back in 2008.

Like they blamed unions. The unions formed in response to their poor treatment of workers. Then every union contract that was in effect was signed by GM. But it's the union's fault GM forced them into existence and worked with them.

GM backed the creation of these rules. It was an anti-competitive rule to raise the barriers of entry against smaller makers. GM helped make those laws, then complains about them years later, like they had no hand in making them.

These aren't NEW, they aren't getting 'legislated out of existence' they failed to build a business model that fits the current laws.

The law says that a dealer in Iowa can't be the manufacturer. The federal law (should trump Iowa law) says that states can't restrict interstate commerce.

Iowa says it's illegal for a Californian company to sell to an Iowan buyer. Iowa is violating US law to block these drives and sales.

Re:The "old boys' club"

[whoever57]

As soon as Tesla set up shop in Iowa (the site they're doing the test drives from), it ceased to be interstate commerce.

So that's why the drugs the people buy from their local pharmacy are regulated by state laws and not federal laws .... oh wait.

The Supreme Court decided that just about anything can be interstate commerce. Growing weed in your own garden can be regulated as interstate commerce. Yeah, it's ridiculous, but that's the way things are.

Re:The "old boys' club"

[sumdumass]

The law says that a dealer in Iowa can't be the manufacturer. The federal law (should trump Iowa law) says that states can't restrict interstate commerce.

This isn't interstate commerce though.

Iowa says it's illegal for a Californian company to sell to an Iowan buyer. Iowa is violating US law to block these drives and sales.

No, the law says t's illegal for a Californian company to sell to an Iowan buyer _in_Iowa_. That buyer can go to California or any other state where the sale is legal, purchase the car and bring it back to Iowa (then go through the process of transferring the tittle from California to Iowa and all).

Also, what law do you think Iowa is violating? Don't quite the US constitution as it is not a law, it is a restriction on government. If congress has not made a law pertaining to this, whether they have authority to do so is meaningless unless they have acted on that authority. As far as I am aware, they have not which is how California is able to place emissions restrictions on cars manufactured outside the state over and above federal regulation for all car sold in the state.

Re:The "old boys' club"

[0100010001010011]

A person shall not engage in this state in the business of
                        selling at retail new motor

Ellon Musk should personally buy some cars and sell them at Auction as 'used cars, low milage' in Iowa.

Not a safety thing.

[Brannon]

Tesla cars are allowed on the roads in Iowa. Iowa will even register a Tesla car and issue you license plates, etc. They've passed every safety test & regulation that any other car has.

You just can't *buy* a Tesla car in Iowa because of dealer-sponsored 'franchise' laws. It seems pretty weird that those laws cover giving out test drives--I'm sure Tesla's lawyers will look into that.

OK, so set up a tiny company owned "dealership".

[Dzimas]

Car makers are prohibited from selling directly to the public because they could potentially undercut their own dealers. In Tesla's case, there are no dealers to undercut. That said, the solution would be to set up a small company owned showroom in Iowa that acts as the seller of record for all online and in-person sales within the state.

No wonder Arizona and Texas didn't win Gigafactory

[JoeyRox]

The article lists all the states that ban or limit Tesla's no-delaer business model and it includes Texas and Arizona, two of the four finalists for Tesla's new battery Gigafactory. Did those states think they had a chance when they support that crooked business cronyism?

What do test drives have to do with it

[russotto]

I can see that Iowa can prohibit in-state sales not through dealers, but why would that forbid Tesla from providing test drives and then, if the customer wants to talk turkey, refer them to e.g. a Missouri store, or an Internet site based in another state? This is how Tesla handles NJ; you want a Tesla in NJ you can test drive one and then hop over to NY to buy it.

Is there some Iowa law against manufacturers allowing people to borrow cars for free?

Commerce among the several states

[tepples]

I think you know what lakeland meant. Commerce between Tesla, a corporation not headquartered in Iowa, and residents of Iowa is "commerce [...] among the several states", the regulation of which is explicitly within the enumerated powers of the Congress.

Re:Good to see this kind of crap

[ShanghaiBill]

Conservatives are criminal-minded hypocrites and voters should wake up and vote them out.

Car dealer franchise laws are common in both conservative and liberal states. Iowa, the subject of TFA, is a moderate swing state.

They want the court fight

[Sycraft-fu]

They know this is an issue they'll win in the long run. There is no justification for the states doing what they are doing, they've just been paid off by the auto dealers. Tesla has won every fight about this I'm aware of. So they want it, they want to get this straightened out in the courts.

If you try to do something to skirt the law, you risk it biting you in the ass later. If you get a court ruling saying "You are allowed to do this, the state has to F off," then you are good to go.

Also, you might notice it gets them press. Nothing like looking like the poor trod on underdog to get more people sympathetic to your cause an interested in your product. They go about everything above board, get stepped on, fight back, win, and then get their way, plus good PR.

Have to take the long view on these things.

Re:Dealer as union

[AK Marc]

Like Continental Subaru?

I had a problem with my brakes. On my Subaru Impreza WRX, they didn't work when I went over wet railroad tracks with the brakes applied (the ABS back-off algorithm wouldn't allow best braking). This would, on a road I regularly took, double my stopping distance. It was a major safety issue. When I noticed the problem, I looked online and found it a common problem. Subaru issued a voluntary recall to replace the ABS controller (the entire ECU, since they were linked). I called the dealer, scheduled the repair, gave the TSB number and confirmed they'd have the parts in. They called back "when the parts were in" and I took it in.

The next day, they called and asked me for the TSB number, as there were "no recalls for my vehicle". I took in two separate TSBs (the one I wanted, and one more I got that I didn't care about). They confirmed that there were, in fact, "TSBs" for my car, but the two I had marked "voluntary recall" were not recalls.

Despite giving the TSB number and indicating it was an ECU change and to not schedule me without having the parts in, I picked up my car that day, and waited another 3 months for them to get the part in. When it was finally changed (with a bill of $150 for warranty safety recall work done, because they needed to charge for their test-drive time), the car stopped much better, despite the TSB assuring me the NTSB didn't see any fault in the ABS, nor improvement with the new ECU. Apparently stopping with 100 ft to spare or rolling into an intersection because the brakes didn't work was all in my head.

But Thank God for Continental Subaru, who saw to my safety by scheduling me for a service without the parts on hand to complete it, being ignorant about what TSBs are issued for the cars they sell, arguing with me about which TSB I wanted done, and charging me for getting a safety recall done. Though I'm not sure a manufacturer could do any worse if they tried.

Re: Good to see this kind of crap

[ShanghaiBill]

Uh no. Iowa has been right wing for a long time.

Tom Harkin is likely the most left wing senator. Iowa elected him repeatedly for decades. The legislature is balanced, with Democrats controlling the Senate, and Republican the House, neither with much of a majority. The governor is Republican, but the last two were Democrats. Iowa may be right wing compared to, say, France, but by American standards it is centrist.

In addition. Nearly all of the other states, are rabid right wingers in control.

Two of the states with the most strict car dealer franchise laws are Maryland and New Jersey. Tesla is locked out of both states.

Car dealer: money-media nexus in local politics

[pupsocket]

Advertising revenues from local news is the largest source of income for most local television network affiliates and local car dealerships are the foundation of their revenues. (TV stations get little or nothing for carrying national programming, just the right to borrow the audience for a couple of hours.)

Local television economics is a political protection racket with car dealers as the collection point for funds, precisely as kings and shahs and sultans handed out exclusive franchises for cloths and dyes and wines and every manner of goods.

Car dealers fund a local-news system that ensures that Congressional representatives and state governments are rarely reported on.

Threaten laws protecting car dealers, and get you a lot of enemies who don't want to show their faces.

Meanwhile in California......

[haruchai]

Gov Jerry Brown signs 6 bills in favor of EVs

http://www.greencarreports.com...

Re:Good to see this kind of crap

[JimSadler]

Thank God i found a soul mate. Yes, the right wing doctrines are evil and those that support evil are evil. The age of capitalism is dead. It was killed by reality and the right wing just can't get it. We are now entering the age of cooperation instead of the age of competition. We have no choice now. Yet the cluster of assumptions is log jammed into the conservative mind. Politicians yelp about growth. Yet we see what growth has done to cities like Detroit. Nature demands that roof tops occupy less space, that roads disrupt less space, that agriculture be more productive with far less side effects and that big oil and big coal start to shut down altogether. So in order to have an economy we need to count on more quality and not more space and more pollution. Tesla is a land mark in quality and deserves every bit of support that government, both left and right wing as well as all of the public support Tesla. And some jerk who happens to make his living selling gasoline powered cars needs to get out of business until he can sell a product at least as good as the Tesla. We do not support welfare for car dealership owners.

Re:Read it and weep ...

[Areyoukiddingme]

Only licensed dealers may engage in the business of selling cars at retail. Test drives are probably considered to be part of that business; there's not many other cases where a company will lend you a vehicle for free to drive a couple of miles.

But Tesla CAN'T sell cars in Iowa. There is no one from Tesla in Iowa who will take your money. So by definition Tesla test drives are not selling cars. There's guaranteed never to be a sale in Iowa.

Tesla's lawyer will no doubt dig up case law to that effect, but I don't see the need. It's black letter law. No Teslas are sold in Iowa, therefore Tesla's activities are not selling cars, therefore those activities are legal. Yes it's a loophole, but it's a legitimate loophole. You can promote whatever you like. It's just speech. Which is free. As long as no sale occurs in Iowa, the law isn't broken.

Tesla...

[Issarlk]

"so good it's illegal !"

Re:No wonder Arizona and Texas didn't win Gigafact

[drinkypoo]

Did those states think they had a chance when they support that crooked business cronyism?

alternately, were those states only considered to begin with to rub their noses in the potential loss of business?

Re:Read it and weep ...

[jader3rd]

... because it's illegal.

Nothing else matters at all. If it's against the law, then it is what it is.

So the American Revolution was illegal and should have never happened because nothing else matters?