Saturday, March 12, 2016

Why Tesla Can't Operate In Utah.

Before I get into my responses, let me give a quick background on the issue with the Tesla store in Utah. You may need to double check the dates and numbers since I'm piecing the information together now after the fact.

About a year ago, Bill HB294 (substitute 1) which was in the works for about a year was defeated in the House. This Bill outlined regulations for new car dealers -- in this case, Tesla Motors, to operate in the State without the use of a third-party dealer. This issue is being debated in virtually every State in the US with varying success.

On February 23, 2016, the video of a Utah House of Representatives meeting was published on YouTube containing raw footage of the presentation and discussion of Bill HB294 (Substitute 2), another attempt to get the Bill passed. If you aren't a Tesla fanatic, this may come across ridiculously dry and boring. But if you are wondering what the issues are that blocks Tesla from opening direct sales stores in various States, the lengthy discussion in this meeting may be an eye opener.

DISCLAIMER: I should say that I'm not up to speed with all of the details of this issue. That includes the exact date of the meeting in the YouTube clip. Ask a Utah-residing Tesla owner/follower if you want more indepth insight into the matter. I'm just highlighting the issues raised in the discussion at the house via the video post.

The discussion of the bill starts at 19:51 and ends at 1:16:18. Yup, a lot of people have a lot to say.

Now you may call me a bit of a conspiricy theorist here, but I'm very suspicious about the outcome of the vote and frankly, am surprised considering how Utah prides itself in supporting free-market as a driving force for their economy.

1. It was not clear that the last minute changes made to the bill the weekend prior to this meeting were completely vetted by the two negotiating parties, the motor vehicle dealers and the new car dealer, Tesla Motors. 
Based on the discussion, my sense is that the house members are either unconvinced that a true consensus was reached, or that their interest in the issues have gone stale, and they just prefer the bill to shop showing up over and over for discussion. Most of the members who did speak are clearly passionate about the bill and want it to happen. But the unclarity in Sen. Coleman's responses to questions about whether or not consensus was reached leaves one to think that full consensus was not confirmed prior to the bill's presentation.

2. The car manufacturers who "control" the dealerships are much more involved than they let on.
It's clear, and frankly not too surprising, that the franchised dealership owners are not happy with the decades of abuse that they have suffered under the heavy hand of the auto manufacturers. I commend them for even considering the amendments to allow Tesla to set up shop in the state and not forcing them into this dysfunctional relationship-type business model. But what was surprising was Sen. Coleman's statement that they reached out to the car manufacturer's directly and it was clear they were not interested in getting involved with the negotiation. Considering GM's desperate attempt to push down Tesla (consider their involvement in Indiana) in favor of their upcoming new Bolt EV, and their direct involvement in the Bill in Indiana (which was probably less of a compromise and more of a ban) they certainly would have a vested interest in this bill. Or perhaps they have paid off enough senators to have the majority of them vote against the bill. If you notice in the video, the nay-sayers seem to be eerily silent throughout the whole discussion. We don't want to think that the legislature has been corrupted, but we can't turn a blind eye to the US problem of corporate endorsements in exchange for political gain.

3. Two words: Koch Brothers
The best way to stay out of trouble is to stay out of the limelight. If it is correct that the Koch Brothers are investing 10 million dollars to combat environmental government subsidies, I suspect this is just a smoke screen for a much more underhanded business. They want to kill the electric car -- again. That part is clear. And politics is one very powerful way to do that. I'm just saying...

I should add that I have read elsewhere that Tesla is suing the State of Utah over the unfair regulations. After all, they allowed them to invest 3 million dollars into a new store, and then put a stop to their grand opening celebrations just days before it was to take place. Now it has stayed empty for over a year, racking up property fees and taxes, while they wait for the politics to play catch up. They also are appealing to the Federal Courts for help.

Read the defeated Bill here:

A small sample of news to read and watch for a snapshot of the issues:

Run-in with Utah law could block Tesla's grand opening plan. The Salt Lake Tribune, Mar 4, 2015
Bill Opening Door for Tesla, other online dealers advances to House. The Salt Lake Tribune, Mar 5, 2015
Lawmaker pushing for compromise over Tesla Sales in Utah. Deseret News. July 15, 2015
Tesla sales bill in Utah sputters to halt after multiple changes (updated)  "Green Car Reports" Mar 16, 2016

And another YouTube Clip:

No comments:

Post a Comment

Thank you for responding! :)