NJ agrees to ban Tesla's direct sales
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A New Jersey agency has agreed to ban Tesla from selling cars directly to consumers in the Garden State Tuesday.
Tesla (TSLA) has been selling directly to shoppers at two locations in New Jersey for about a year, but state officials will now force the automaker to sell cars through a franchised car dealership.
James Chen, a Tesla attorney, told members of the New Jersey Motor Vehicle Commission that the change will force Tesla to close its existing sales operations in the state and layoff 27 employees, according to documents posted to the commission's website.
Tesla's practice of selling its Model S electric sedan directly to consumers is unusual and has run into problems before. Chief Executive Officer Elon Musk has tangled with dealership associations in various states including Texas and New York.
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The change agreed to by the New Jersey commission Tuesday, "simply conforms their regulation with state law," said Jim Appleton, the president of the New Jersey Coalition of Automotive Retailers, also known as NJ Car.
Appleton favors the law, which aims to encourage price competition and ensure customers have access to warranty and recall services, he said.
Tesla was not immediately available for comment. A spokesman said the company would issue a statement soon.
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Originally Posted by Quanty
