Missouri Legislature Could Ban Tesla Cars with "Sneak Attack" Amendment
A last-minute amendment added days before the end of Missouri's legislative session could block electric-car company Tesla from selling to customers in Missouri.
pestoverde on Flickr Elon Musk, Tesla's cofounder, calls the amendment on House Bill No. 1124 a "sneak attack" on his business.
Tesla decried the legislative maneuvering as a "sneak attack" that would "hurt consumer freedom in Missouri" after learning about the amendment to House Bill 1124. The amendment would stop car sellers like Tesla from circumventing franchise dealers and selling directly to customers.
The Missouri Senate passed the bill, including the amendment, without debate Wednesday.
Update, 10:40 a.m. - Republican Majority Leader John Diehl tells the Associated Press he has no plans to move forward with the bill, especially since so many other lawmakers are concerned that it could limit the free market and have other unintended consequences. End of update.
So what has Tesla so hot and bothered? House Bill 1124 says that dealership franchises are not allowed to sell directly to consumers, and the amendment expands the definition of "franchise" to include car manufacturers such as Tesla -- a move that Tesla Motors co-ounder Elon Musk calls "a pirouette of which the legislators may not even be aware."
Tesla, which has one service center in St. Louis and is opening another in Kansas City, says it sells cars directly to consumers -- not through franchise car dealerships -- to cut out the unnecessary middleman. If passed in its current form, the bill would effectively stop Tesla from selling its cars in Missouri.
"To be clear: This is worse than a mere case of dealers trying to protect an existing monopoly," Musk writes on Tesla's blog. "This is a case of dealers trying to create a monopoly."
The bill's sponsor, Representative Glen Kolkmeyer, a Republican from Odessa, tells the Springfield News-Leader that allowing Tesla to sell directly to consumers opens the floodgates for foreign dealers to sell cars to Missourians over the Internet.
Representative Glen Kolkmeyer.
"You can't have two sets of rules for the same type of business or industry," Kolkmeyer told the News-Leader. If Tesla wants to sell in Missouri, Kolkmeyer adds, it'll have to follow the same procedures as a Ford or Honda dealership. "Our forefathers decided that any car sold in the state of Missouri would be sold through a dealer. This new company is skating around those rules."
The legislative session ends this week, making it the perfect time to sneak through amendments that senators and congressmen might not catch before summer break. Kolkmeyer denied to the News-Leader that the anti-Tesla amendment was purposely filed at the last minute.
"This issue has been vetted more than most issues down in Jefferson City, just through the halls and e-mails and what have you," Kolkmeyer said.
Tesla officials planned to protest the amendment in Jefferson City Monday. The bill still needs approval from the House.
"This debate should be held in the full light of day with all sides being given an opportunity to make their case," Musk says in a Tesla blog post titled "Trouble in Missouri."
"Instead, the dealers are again trying to ram through a provision under the cover of darkness and without public debate. The people of Missouri deserve better from their elected officials."