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Tesla Wants Texas Auto Sales Regulations Loosened
An anonymous reader writes Tesla decided not to build its new $5 billion battery factory in Texas, but the company still wants to sell its electric cars directly over the Internet there. The automaker hopes that the possibility of future investment in the state will be enough to overcome the Texas Automobile Dealers Association lobby and change dealership laws. From the article: "Diarmuid O'Connell, Tesla's vice president for business development admits that getting the law changed won't be easy. 'Does the fact that we didn't site the factory there complicate things? Absolutely,' O'Connell said. 'But we're going to be doing a number of big battery factories in the coming years and we're going to need new vehicle factories as well, and there's a certain logic to doing those in Texas.' He didn't elaborate, but added that the state may not be so attractive if current sales regulations stand. 'If we're banned in Texas, why are we investing billions of dollars here?,' O'Connell asked."
By "republicans" you mean "Democrats" .
... which meant "conservative" for the time period in question.
Texas didn't have a single. Republican governor between 1876 and 1983. These laws were passed in the late 1930s and early 1940s (first in 1937). So that's right in the middle of the Democrats' hundred-year reign in Texas.
So what you're saying is that Texas only voted in a Republican governor after Nixon's Southern Strategy brought all the ultra-conservative pro-segregationists over to the Republican party? What an interesting coincidence.
> the current rules favor incumbents. The current rules are against progress.
The whole point of these laws is to prevent the big three established automakers from controlling the market and bullying the little guy. Anyone is allowd can sell cars in these states, except for the big bad car companies, so you don't have any 800 pound gorillas bullying the individual dealers.
Dealers are local, so they've been able to successfully lobby state lawmakers to slant the law even against the far-away car companies and toward local dealers. That's ANY local dealers, including local Tesla dealers.
Tesla wants the same thing Ford and GM wanted, a type of monoply known as a vertical integration monoply. A vertical monoply is when one company controls the entire chain from manufacturing major parts (Tesla's battery mega-factories), building the cars, the distribution network, sales, and service.
Contrast to a horizontal monopoly, where one company controls all car sales. In the horizontal, they control only one layer, but completely control that layer. In the vertical, they participate in, but do not necessarily control, control all layers.
To combat these vertical monopolies, voters decided in the 1930s and 1940s that the company who manufacturers parts (Tesla), builds the cars (Tesla), and controls wholesale distribution (Tesla) can't also control sales and service. Other companies get to compete to provide the best sales and service. That's the purpose of the law.
Personally, I'm not sure that I need to be protected from this type of vertical monopoly given the strength of Toyota and Honda in the US. If the big three from Detroit don't treat me right, I'll just buy a Toyota.
The port of Houston was ranked 2nd nationally in total tonnage in 2012. The port of Oakland was ranked 34th.
Houston is not far from the Atlantic (via the Gulf of Mexico) or the Pacific (via the Panama Canal).