For decades, Texas has had very strict laws on the books which prevent you from buying a new car anyplace except at the car company's authorized and licensed dealer. But it appears that the lure of a new factor and 6500 jobs may be prompting state officials to throw the car dealers under the bus, 1200 WOAI news reports.
Gov. Rick Perry has indicated that he would be willing to revisit the law, if that's what it takes to attract Tesla Motors, and it's proposed 'giga-factory' which plans to mass produce electric car batteries, to Texas.
Tesla CEO Elon Musk has already placed Texas on the short list of four states where the factory, which will be powered by solar power, will be built. The factory will employ 6500, and will work on the Henry Ford model, that the best way to bring down the now prohibitive cost of electric car batteries is to make more of them.
But Tesla doesn't have dealerships. It sells its cars through mall storefronts, like you might buy a computer at Best Buy, and Musk has indicated that the law prohibiting that in Texas could be a factor in his decision. Other states on Musk's short list are Arizona, New Mexico, and Nevada.
Lee Chapman, a spokesman for the state's car dealers, says Perry needs to think twice before changing an established law that clearly benefits consumers.
"This enables consumers to have a choice of where they buy a car," he said. "Having a single point to buy a car would destroy that. And they would also have to pay the price that the manufacturer sets for the car. There would be no competition among dealers, and that gives consumers the best price."
Chapman says dealers also serve other roles other than selling cars. He says good luck getting service, parts, or warranty service at a storefront sales point.
"Dealers have a tremendous amount invested in their dealership, they have a tremendous amount invested in their employees," he said. "There is also the amount they have invested in their service and warranty operations."
Dealers also point out that in case of recalls, the dealership is the place that handles the paperwork, contacts the owner, and does the repairs.
Tesla has auto 'showrooms' in Texas, but they are not allowed to even quote prices for cars, and if a customer decides to buy a car, they can't drive it home, it is delivered to them by a third party vendor.
Chapman says he thinks Gov. Perry could close the deal without making major changes in state law.
"We are very much in favor of that factory being built in Texas," he said. "It is my belief that the governor is such a great sales person, he doesn't need to try to entice them at all."