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‘Tesla didn’t ask to sell cars directly in the state’, says Michigan after denying Tesla’s request for a dealership license

Interior of the Cleveland store as line filters in.

Tesla’s battle to sell its vehicles and serve its existing customers directly in Michigan took an absurd turn last week. Tesla has been trying to open a store and service center in Michigan for the better part of the last 3 years, but it hasn’t been able to get around state laws, which is why it sued the state earlier this year.

Responding to the lawsuit last week, the state claimed that Tesla hasn’t tried to sell its cars directly in the state – something illegal under state law in Michigan and the reason why the company is suing the state.

The state is denying the allegations brought forward by Tesla in the lawsuit that suggests Gov. Rick Snyder and state officials have treated Tesla unfairly or unconstitutionally in its attempts to sell and service its vehicles in Michigan.

But that wasn’t the surprising part. The Detroit News reported:

In an odd twist, the state argues that Tesla “has never sought the ability to directly sell its vehicles in Michigan but only licenses to operate dealerships.”

The only problem with that statement is that a license to operate a dealership is also required to sell vehicles.

Tesla applied for a dealership license last year, but it was rejected by the state in September, which prompted Tesla’s lawsuit.

The automaker claimed that local dealers and GM were behind the direct sale law used to deny Tesla access to its more than 400 customers in Michigan:

“At the urging of local car dealers and GM, Michigan law was changed two years ago to prevent Michigan consumers from buying cars from a Tesla store within the state. As part of the process of challenging the legality of that law, Tesla applied for a license in Michigan. Tesla will continue to take steps to defend the rights of Michigan consumers.”

While the case is going to court, Tesla pushed the boundaries of Michigan’s direct sales law and opened a showroom in the state earlier this month. The company is not selling cars in the showroom and it is treating the space more as an advertising asset, but it certainly highlights the absurdity of the situation.

Featured Image: Interior of the Tesla Cleveland store as line filters in on March 31, 2016 – the first day of Model 3 reservation – by Jon Jivan.

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