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Deadline Kills Tesla's Direct Sales Bill In Texas

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Well, so much for that. Despite Tesla Motors’ biggest push yet to legalize direct car sales in the great state of Texas, a legislative deadline late last week effectively killed the bill, along with scores of others.

The Associated Press reports that midnight last Thursday was the last chance for numerous Texas House bills to win full-chamber approval, making it “far tougher” for them to become laws by the end of this year’s legislative session on June 1.


One of those House Bills was HB 1653, which if passed would amend the state’s law regarding car sales to let manufacturers who have never sold through independent dealerships before to have up to 12 stores for direct sales. In other words, a manufacturer like Tesla would have had up to a dozen stores where they can sell direct.

Tesla has numerous “galleries” across the state where they can inspect cars and, increasingly, take test drives, but the stores cannot discuss pricing or ordering cars. Instead prospective customers must buy them online, leading to a delivery in an unmarked truck.


HB 1653 had a counterpart bill in the Texas Senate; the former came from a Democrat, the latter from a Republican. But both bills were met with tremendous opposition from car dealers who fear the competition direct sales could potentially create. The bills didn’t get a lot of sympathy from representatives on either side of the aisle either. Here’s the AP:

Democratic Rep. Senfronia Thompson — one of the House’s most senior members currently serving her 20th term — said it was the company’s own fault that the bill didn’t pass.

“I can appreciate Tesla wanting to sell cars, but I think it would have been wiser if Mr. Tesla had sat down with the car dealers first,” she said.

Mr. Tesla? I thought he was dead. Isn’t he still dead?

Anyway, here’s the Texas Tribune to elaborate on what happened:

The bills haven’t even drawn a committee vote in either chamber, and Tesla’s lobbyists and lawmakers concede they are doomed. The Senate bill never even drew a hearing in the Committee on Natural Resources and Economic Development.

State Sen. Troy Fraser, the committee’s chairman, recently told The Texas Tribune that the reason was simple: His members didn’t want to do so until the House passed its version. He said he sees no reason to “piss off all the auto dealers’’ on a vote that he believes would ultimately be meaningless.


As the Tribune reports, and as you can read more about here, car dealer interests outspent Elon Musk 40 to 1 in the 2014 election cycle, donating huge amounts of money to top officials like Gov. Greg Abbott and Lt. Gov. Dan Patrick. Tesla brought their lobbying A-game for this legislative session, spending exponentially more than they did last time, but evidently it wasn’t enough.

Maybe Tesla can try again in 2017, the next time the Legislature will meet.

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