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Tesla Appeals New Jersey Direct-Sales Ban

Motor Trend logo Motor Trend 4/3/2014 Christian Seabaugh
2013 Tesla Model S© Provided by MotorTrend 2013 Tesla Model S

The war of words between Tesla and the state of New Jersey continues. After New Jersey effectively banned the sales of the Tesla Model S in the state due to the automaker's direct-sales model, Tesla has officially filed an appeal in New Jersey Superior Court to overturn the ruling.

Tesla Appeals New Jersey Direct-Sales Ban

Tesla's argument hinges on the way New Jersey's direct-sales law is written, reports Automotive News. "As the [New Jersey Motor Vehicle Commission] itself recognized when it licensed two Tesla locations in 2012," Tesla said in a statement, "New Jersey law was clearly written to prevent car manufacturers from exploiting their greater market power to compete unfairly against dealership franchises that sell their cars, something that simply doesn’t apply to Tesla because it has no dealership franchises.”

New Jersey's car dealers are eager to maintain the status quo. The New Jersey Coalition of Automotive Retailers maintains that allowing Tesla to sell the Model S directly to customers instead of working through a traditional independent dealership amounts to an unfair competitive advantage, and one that hurts consumers.

As of April 1, Tesla's two factory-owned stores in New Jersey were considered to be operating illegally. Tesla has until April 15 to stop selling its vehicles completely.

Source: Automotive News (Subscription required)

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