Direct sale of electric vehicles is the right choice
For nearly a decade, a controversy has raged in New York over whether to allow direct sales of electric vehicles (EVS).
A 2014 agreement between Tesla and the state allowed the Ev-only manufacturer five stores, but capped the number of locations and prevented other new manufacturers from doing the same.
This year, a coalition including Tesla, other new Evonly manufacturers, more than 100 environmental groups, and a range of other public-interest advocates are united in fighting for direct sales in New York.
There is only one entity opposed to direct sales: New York’s auto dealers. They argue that new automakers need to play by the rules — rules that they themselves created after Tesla entered the market.
Dealerships believe that all new cars need to be sold through a middleman, even though the Federal Trade Commission and other consumer advocates see no need for this protectionism. They also argue that jobs will be lost if dealerships coexist alongside direct sales. But data from the National Auto Dealers Association shows that this is not the case. Since Tesla entered the market in 2012, dealership sales nationwide have increased by 52 percent and employment grew by 18 percent. In open states, sales and employment overperformed, while closed states underperformed the national average on both metrics, with 29 perent sales growth and 12 percent employment growth. Dealerships have thrived alongside some healthy competition.
There is also the important matter of New York’s climate goals and EV adoption rates: New York is only 3 percent of the way towards its goal of 800,000 electric vehicles by 2025. Embracing direct sales is the way to make up for lost time. In 2020, New York’s nearly 1,000 franchised dealerships collectively sold 1,896 EVS, totaling .2 percent of total cars sales and fewer than 2 EVS sold per dealership in an entire year. By comparison, Tesla alone sold 9,433 vehicles – almost five time the amount of all franchised dealers combined, from just five locations.
Direct sales are right for New York’s climate goals, for motorists, for the state’s economy, and for healthy competition. 2021 is the year to end this controversy for good.