Tesla hired ten lobbyists on Friday to fight House Bill 1124 during the final week of the legislature. The move comes after an amendment was added to the bill that would ban Tesla’s sales model without discussion on Wednesday.
Tesla’s new team includes former House Speaker Steve Tilley; Danny Pfeifer, Greg Porter, and Alex Eaton of the Catalyst Group; Scott Penman and David Winton of Penman & Winton Consulting Group; Brent Hemphill and Kristian Starner of Hemphill and Associates; Heath Clarkston, and Michael Grote.
In the lobbyist arms race, the Missouri Automotive Dealers Association expanded their own presence in Jefferson City. On Friday, they brought on heavy-hitter John Bardgett to join their team, which includes Phillip Schnieders and Doug Smith of the association, Andy Blunt and Jay Reischard of Schreimann, Rackers, Francka & Blunt; and Bill Gamble, Jorgen Schlemeier, Sarah Topp, and Jeffery Brooks of Gamble & Schlemeier.
While most automobile companies sell their cars through dealerships, Tesla opts to eliminate the middleman (an automotive dealership) and sell directly to consumers. They have been given permission to open up kiosks to sell their vehicles in Missouri by the Department of Revenue. Currently, they have one facility in St. Louis and are planning to open a second shop in Kansas City later this year.
Tesla Motors believes they are acting within the current law. Missouri’s Motor Vehicle Franchise Practices Act prohibits franchisers from competing against franchisees. So, if Tesla were to sell its cars at dealerships, they likely could not sell them directly. But, they point out, they do not do that. In a blog post on Thursday, Tesla said auto dealers are trying to “ram through a provision under the cover of darkness and without public debate.”
On Friday, the Springfield News-Leader posted a letter from John Mollenkamp, director of the Missouri Department of Revenue, to Sen. Mike Kehoe – a Republican who had previously owned an auto dealership in Jefferson City – explaining the department’s position.
“It is clear under Missouri law that traditional manufacturers who already have franchised dealerships in the state may not sell cars directly to consumers. It is not clear that the statutes apply to a seller like Tesla, which apparently has not entered into franchise relationships with independent dealers,” Mollenkamp wrote on April 23.
On Monday, members of the St. Louis Tesla Enthusiasts group and their supporters said they plan to travel to Jefferson City to urge legislators to oppose the bill.
Passage of this bill would also result in the closing of the St. Louis Service center costing 15 hardworking Missourians their jobs and requiring current Tesla owners to travel to Chicago for servicing,” said Liz Gattra, co-organizer of the St. Louis Tesla Enthusiasts. “Missourians would still be able to purchase the car online but they would no longer be able to get test drives in the state.”
Tesla has faced similar roadblocks in other states like New Jersey, New York, and Ohio. Earlier in the week, New Jersey adopted language that would require the acquisition of franchise license to sell the high-end electric cars.