Is This New Louisiana Law A Result Of Bullies?
Louisiana House Bill (HB) 167 will, in essence, prevent a major car manufacturer from opening a service center in Louisiana, and opponents are saying that it's because other car manufacturers are bullies.
I just tried to read the bill but, as you know, I am no lawyer. It is written in Legalese and, being a layman, I only understand a word every now-and-again, so I turn to others smarter than I and read their interpretations. Here is what I've gathered: the bill was originally written to protect the dealerships from the manufacturers. Now, so many years later, new manufacturers will have a harder time selling their vehicles because of this law. The dealerships now, apparently, have more political power ($$) than the new manufacturers, and can use that lobbying money to keep new manufacturers shut out.
Some of the comments on Reddit revealed that:
- Opponents say that the bill is aimed specifically at the car manufacturer Tesla. Since Tesla (who makes electric cars) is a newer car manufacturer, they do not have a monetary hold on our politicians like the existing car manufacturers do. The current law states that automobiles can not be sold straight from the manufacturer, only through dealerships. Tesla wants to cut out the middleman and wants to be able to sell directly to consumers.
- Opponents also say that the bill will force Tesla to close down their service center in New Orleans, because the service center (if HB 167 passes) will be in violation of law. If the service center in New Orleans closes, Tesla owners will have to go to Houston for service. (Imagine having to drive to Houston every time your "Check Engine" light came on!)
On the other side of the issue:
- Proponents say that HB 167 protects jobs. They are afraid that, by allowing Tesla (or any other car manufacturer) to sell directly to the public, it will sour the taste for auto dealerships in Louisiana.
Is not all bad. Doesn't Louisiana have one of the highest rebates for EVs (electric vehicles)? This law is about the nearly 300 auto dealers in the state protecting their interests. - Reddit user sethgecko
- Proponents also say that the bill will help ensure that consumers will have a service facility "attached" to the point of purchase.
States want to ensure that, when people buy big ticket items, the items' warranties are properly upheld.
Historically, using dealerships that aren't tied to a particular manufacturer, has helped service vehicles which otherwise might not be sufficiently supported by separate, disparate service centers. Many states have laws requiring service centers be put in place alongside showrooms. You won't hear it here, but Tesla isn't a fan of these laws. They just want to sell. And, as you can see from their repair shops' long wait times for body work, sometimes laws that preempt consumers' need to go to court make sense. Warranties ought to be upheld most of the time without requiring legal action on the part of consumers, and that is what Lousiana officials are trying to do. Arguably, they're unpopular for it, because the effect may be that some sales don't happen in their state. But, they are trying to protect the consumer in the long run, along with their state's economic health. - Reddit user inspiredby
Here's another Reddit user explaining the situation to a 5-year-old:
Back when the auto industry was in its infancy, there were laws put in place preventing automakers form opening their own stores. This was because opening a dealership was (and still is) a very expensive venture. After the franchises would set up shop and establish a business following, the automakers could theoretically come in and set up their own store, undercutting the franchise already in place, pushing them out of business after the franchise had already done the hard part. These laws made sense 75-100 years ago. Problem is, Tesla has never franchised from the get go, while the other automakers did. Tesla, being a "new kid on the block", has all the other automakers scared. There is a lot of lobbying to force Tesla to bend to the rules every one else has to play by. The problem is that the original intent of the law was to not allow automakers that franchised to open their own stores. Tesla never franchised from the start so the big auto dealer groups ... are pushing for this to pass to keep Tesla and their business model out of the state. - Reddit user one_ball_in_a_sack
How do you feel about this situation? Do you think that the auto dealer lobbyists are being bullies? Do you think that they are scared that Tesla, or any other manufacturer with no middleman will damage their business enough for them to inconvenience the handful of Tesla owners in Louisiana? Do you think that our politicians have their hands in too many corporate pockets?