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March 17, 2016

Tesla bill goes to Senate for vote

PHOTO | HBJ File Tesla bill moves forward in Connecticut.

Tesla’s ongoing attempt to sell its electric vehicles in Connecticut has passed a major legislative hurdle and now goes to the Senate for consideration.

The bill, introduced by Senate Majority Leader Bob Duff of Norwalk, is tailored made to Tesla’s situation. It allows the motor vehicle commissioner to issue a new or used car dealer’s license to a manufacturer that does not have an existing franchise agreement with any new car dealer in the state. Currently, Tesla has no dealers in the state because it sells directly to customers and does not franchise dealerships.

The legislation also prevents existing manufacturers from setting up subsidiaries to circumvent existing franchise laws. It prevents a manufacturer with a controlling interest to be licensed as an electric-vehicle dealer that can sell direct to the public.

Earlier this month, industry associations representing automobile dealers and manufacturers came out against the proposal that would allow Tesla to sell its high-end electric cars directly to Connecticut consumers, effectively bypassing dealership franchises.

The Connecticut Automotive Retailers Association and the Alliance of Automobile Manufacturers – which represents a dozen major manufacturers – said proposed Senate Bill 3 would create an unfair playing field for Tesla.

At that time, James Chen, Tesla's deputy general counsel and vice president of regulatory affairs, portrayed the auto dealers and manufacturers as "entrenched interests" trying to block innovation. Chen said passage of the bill would mean economic development in Connecticut.

Tesla pushed for a similar bill last session, but the legislation died in the House, despite a brokered compromise brokered that would have limited Tesla to three sales locations.

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