The high-end electric car manufacturer Tesla Motors prevailed in a lawsuit filed by Massachusetts auto dealers in an attempt to stop the company from selling directly off the assembly line to customer.
The Massachusetts Supreme Judicial Court threw out a lawsuit from the Massachusetts State Automobile Dealers Association that argued that the California-based Tesla was skirting a state law that is intended to protect car dealerships from direct sales by manufacturers. The ruling on Monday stated that the original law and an amended version were designed to protect dealerships from manipulation by their brand manufacturers, rather than to prevent direct sales by non-affiliated companies.
State Sen. Marc Pacheco, D-Taunton, filed a bill in January 2013 to defend auto dealerships from the threat posed by the business model used by Tesla, with language that would clarify the current state law, emphasizing a “blanket prohibition” on manufacturer ownership of dealerships. Tesla has an installation at the Natick Mall promoting their cars, with a separate town-licensed location where they can test-drive the cars and buy them. But without a third-party dealership, the auto dealers association considers it against the spirit of the state law, which was last amended in 2002.
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