March 14 Tesla Motors Inc escalated its
war of words with New Jersey on Friday, lambasting a regulatory
change approved by the state earlier this week that bars the
"green car" company from selling vehicles directly to the
The electric car maker is now studying "judicial remedies"
to fight the ruling, Chief Executive Elon Musk said in a sharply
worded blog post. The ruling, which requires sales of all new
cars to go through dealer franchises, was approved by New Jersey
Governor Chris Christie's administration on Tuesday.
"The rationale given for the regulation change that requires
auto companies to sell through dealers is that it ensures
'consumer protection," Musk wrote. "If you believe this, Gov.
Christie has a bridge closure he wants to sell you!"
He added: "Unless they are referring to the mafia version of
'protection,' this is obviously untrue."
Christie has been under political fire over a traffic
scandal at the busy George Washington Bridge
A spokesman in Christie's office referred to a statement
from earlier this week that said Tesla had known for a year it
would need approval from the state legislature to establish its
Musk has long argued that the dealer franchise system is a
bad fit for 11-year-old Tesla because he says traditional car
dealers make more money from gasoline-powered cars and as a
result they have less incentive to advocate for electric cars,
like the Model S sedan.
But dealers say the franchise system, in which automakers
rely on a network of independent dealers to sell cars, offers an
extra layer of accountability for consumers. Competition between
dealers also lowers vehicle prices, dealers say.
"This is the business equivalent of a temper tantrum and
Elon Musk needs to take a deep breath," Jim Appleton, president
of the New Jersey Coalition of Automotive Retailers, said when
asked to respond to Musk's blog post on Friday.
Starting on April 1, all of Tesla's stores in the state will
convert to galleries, where potential customers can see the car
and ask questions. But staff will not be able to discuss price
or complete a sale of a car.
However, Musk said, New Jersey residents can still order the
Model S electric car online. They can also buy the vehicle from
Tesla stores in New York and near Philadelphia.
Palo Alto, California-based Tesla unveiled its Model S in
2009. The all-electric sedan costs $70,000 and up.