Tesla seeks to establish its own dealerships in Wisconsin

The logo of Tesla Motors is seen at the stand of US carmaker during the press day of the Geneva Motor Show on March 2, 2016 in Geneva. / AFP / FABRICE COFFRINI

MADISON — Officials with electric car manufacturer Tesla urged Wisconsin legislators Tuesday to let them establish their own dealerships in the state, saying they need direct contact with customers to educate them about how to drive the vehicles.

Tesla attorney Jonathan Chang told the state Assembly and Senate transportation committees during a public hearing to pass a bill that allow the company to run its own dealerships directly. Current state law prohibits automakers from operating or controlling a car dealership.

Chang said driving a Tesla vehicle requires dramatic changes in driving habits and the current dealership model can’t teach drivers how to use the cars.

“It’s really a culture shift,” Chang said. “Franchise dealers aren’t able to sell these cars. Dealers aren’t willing to invest that time.”

Representatives from the Wisconsin Automobile and Truck Dealers Association pushed back, saying the bill would signal the beginning of the end of franchise dealers. Car makers will create subsidiaries to sell electric cars exclusively so they can sell them directly, Bill Sepic, the association’s president, told the committees.

He also warned that allowing Tesla to set up its own dealerships could expose the state to unfair trade practice lawsuits by an established automaker.

“Is it worth destroying a thriving, dependable industry?” Sepic said.

Nearly two dozen other states allow Tesla to run its own dealerships.

“You make it sound as if the world is falling apart but it’s the norm in other states,” Republican Rep. Bob Kulp of Stratford said.

Republican Sen. Chris Kapenga of Delafield, one of the bill’s chief authors, told the committees that government’s role is to create a free marketplace where willing buyers can connect with sellers.

“The principle of free market and government is what we’re debating here,” Kapenga said. “The facts are we have a Fortune 500 company that wants to do business here.”

The WATDA’s Sepic rejected that notion.

“This bill is not about free enterprise. This bill isn’t about access,” he said. “We’re not prohibiting ownership. Are we even prohibiting the lawful sale of these vehicles? This is bill isn’t about jobs or economic development, either. It’s a job killer.”

The committees were not expected to vote on the bill Tuesday.