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.
Founded by billionaire inventor Elon Musk, Tesla Motors produces what is widely considered the premier electric car because of its battery life and horsepower.
But Tesla doesn’t sell through traditional franchise dealerships. Customers can buy the Model S online or at one of a handful of Tesla stores around the country.