Tesla Still Wants To Come To Michigan

In an early morning article from the Detroit News, it was revealed that Tesla Motors Inc TSLA has made additional steps toward serving customers in Michigan.

The company applied for a collective group of licensing that would allow Tesla to "sell and service its luxury electric vehicles in Michigan" late last year, but has encountered some resistance. The current Michigan legislation prohibits the selling model Tesla uses.

The Legal Complications

In October 2014, Michigan Governor Rick Snyder signed legislation into law that effectively prohibits direct selling to customers, Tesla's current business model. The law effectively "closed a loophole" in the auto industry by disallowing manufacturers to sell via a "company-owned retail" model and sidestep the dealership avenue, according to the Detroit News.

"Auto dealers have long insisted protections are needed for franchise dealers who have invested millions in storefronts; they worry dealers could be undercut if automakers sell directly to consumers," the article explained.

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Timeline Of Events

• Prior To October 2014: Michigan Automobile Dealers Association initiated the bill.
• October 2014: Governor Snyder signed the bill.
• May 2015: Federal Trade Commission "urged the Michigan Legislature to reconsider the ban" based on the nature of "protectionism," which is likely to cause harm to "both competition and consumers."
• November 2015: Tesla submitted applications for a "Class A" dealership license.
• December 2015: Tesla estimated 400+ customers in Michigan alone who must travel beyond state lines to buy a Tesla vehicle.
• "In Recent Weeks": While the exact date was undisclosed, Tesla and the Michigan Secretary of State Office confirmed that "follow-up" information was submitted from Tesla to the State regarding the application.

A Tesla spokesperson told Benzinga in an email, "Tesla is committed to being able to serve its customers in Michigan and is working with the legislature to accomplish that."

The spokesperson continued, "The existing law in Michigan is very harmful to consumers. Tesla will take all appropriate steps to fix this broken situation."