The Mississippi Senate on Thursday passed a bill restricting sales of electric cars to franchised dealerships, preventing automakers from selling EVs directly to customers in the state.
The bill, which was introduced by Mississippi House Republicans now heads to Republican Gov. Tate Reeves, who has not indicated if he will sign it, the Associated Press reported. The bill sparked debate among Republican lawmakers on the Mississippi Senate floor before passage. Opponents said sales restrictions would interfere with the new-car market, possibly stopping automakers from bringing new jobs to the state, while proponents of the measure said that it would ensure all automakers “play by the same rules,” according to the AP.
This bill is different from one recently introduced in the Wyoming legislature, which aims to encourage the ban EV sales by 2035. The Mississippi bill does nothing to discourage or ban EV sales, but makes their sale possible only through the traditional franchise dealership model.
The bill reignites a debate from roughly a decade ago, when Tesla began opening company-owned showrooms and pushing online sales as an alternative to the traditional franchised dealerships owned and operated by third parties. This led to a state-by-state series of legislative battles between Tesla and dealership lobbyists over changing existing franchise laws to allow direct sales.
Tesla currently sells cars at one brick-and-mortar location in Mississippi, which is classified as a store, not a dealership, allowing the automaker to operate it outside of state franchise laws, the AP noted.
Other startup automakers, such as Lucid, Rivian and Vinfast, have mostly copied Tesla’s approach with company-owned showrooms and an emphasis on online sales. In some cases, that means automakers can’t directly sell the vehicles they are building, or plan to build, in states with strict franchise laws. Acura also aims to conduct only online sales of its electric vehicles.
Tesla ran into this problem after failing to get the Texas legislature to allow direct sales ahead of the ramp-up of its factory near the state capital of Austin. A 2022 report noted that a similar overhaul of franchise laws will be needed for Rivian to sell vehicles built at its second plant in Georgia, scheduled to open in 2024, directly to customers in that state.
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