Mississippi Bans EV Automakers From In-Person Sales

Government / 10 Comments

Online sales are fine but only franchised dealerships will be allowed.

Mississippi Governor Tate Reeves signed a bill earlier last week forbidding state residents from purchasing all-electric vehicles from non-franchised dealerships. House Bill 401 was signed by Reeves after it passed the state senate earlier this month. Online direct-to-consumer sales, however, are still allowed, meaning people can still buy a new Tesla Model 3 or Rivian R1T.

But, neither automaker, along with new players like Lucid, has franchised dealerships anywhere in the US or the world. Some US states, such as Colorado, do allow these EV brands to have direct sales via "showrooms" where customers can see the vehicles in person, ask questions, and place orders. As for Mississippi, the EV sales debate has sparked a debate within the state's Republican Party.

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On one side of the issue are those who firmly believe in the free market and don't want the government to interfere. They're also rightly concerned the ban could prevent EV carmakers from bringing new technology and jobs to the state. Others, however, believe all automakers must play by the same rulebook with franchised dealers. This business model has been in place for a century but times are changing. "Almost 200 small businesses in communities across our state are seeking assurances that big manufacturers can't just destroy their businesses. That's fair!"

Reeves, a Republican, said in a statement posted to Twitter. "I also recognize that innovation in this industry is inevitable. And with innovation comes new companies with new business models. I am committed to find long-term solutions-in an ever changing market."

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Not surprisingly, the governor has his intraparty critics. "In today's world, if you don't innovate, you lose out. We as a state cannot afford to lose out," Wiggins told the Associated Press. "My vote against the bill was a vote for capitalism, competition and innovation rather than for a policy of protectionism." The lawmaker was previously hoping to bring Tesla to the state's Gulf Coast, a region that's ideal because of its access to ports.

The dealership franchise debate is not new and isn't expected to go away anytime soon. Powerful auto dealers associations view these EVs brands as serious threats to their way of doing things and have convinced some lawmakers of this. Looking ahead, something is going to have to give because consumer buying habits are changing fast.

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