P&A Providers & Administrators
MenuMENU
SearchSEARCH

Deadline for Gov. Rick Snyder to Act on 'Anti-Tesla' Bill is Today

October 21, 2014
4 min to read


DETROIT, MI - It's hard to remember the last time the word "its" has held such gravity in a proposed piece of state legislation, let alone one that relates to vehicle sales, reported Michigan Live.


But in a bill that has made it onto Gov. Rick Snyder's desk, the word "its" would be taken out of a Michigan law, and that would essentially ban Palo Alto, Calif.-based electric car maker Tesla Motors from doing business in the state, according to Todd Maron, Tesla's general counsel.

Ad Loading...


HB 5606, which principally addresses a separate issue surrounding the fees auto dealerships charge for preparing documents, had language added in a substitute from the Senate floor that alters just one word of existing Michigan law:


HB 5606 states a manufacturer cannot "Sell any new motor vehicle directly to a retail customer other than through franchised dealers, unless the retail customer is a nonprofit organization or a federal, state, or local government or agency."


MCL 445.1574 states that a manufacturer cannot "Sell any new motor vehicle directly to a retail customer other than through its franchised dealers, unless the retail customer is a nonprofit organization or a federal, state, or local government or agency."


"It's hugely important and that's why dealers sought to have it stricken," Maron said. "By taking that out it changed to whether you had franchised dealers."


That's not all the legislation does to make it an "anti-Tesla" bill, according to Maron.

Ad Loading...


He said that words near the end of HB 5606 also alter how cars are permitted to be shown in the state, meaning that Tesla would not be permitted to display its cars to potential customers.


"These changes were put in at the last minute with nobody vetting them," Maron said, adding, "It looks like what they were trying to do is completely shut us out of Michigan."


Terry Burns, executive vice president of Auto Dealers of Michigan, told MLive last week after the proposed law easily passed through both state chambers that Michigan law already prohibits direct-to-consumer car sales, while Rep. Aric Nesbitt, R-Lawton, one of the bill's sponsors, said the amended legislation has nothing to do with Tesla.


Tesla, which sells its cars in at least 22 states, typically out of shopping mall storefronts, has already run into what some see as dealership-backed laws preventing its direct-to-consumer sales in places such as Texas, Arizona, New Jersey, and to some degree, Maryland, according to Maron. In those instances, he said dealerships have been trying to protect their traditional sales structure against Tesla's unique model.


In Michigan, Maron acknowledged that the company is not licensed to sell directly, but said it had been working with the Sec. of State Ruth Johnson's office to change that.

Ad Loading...


With parts suppliers and other support, Tesla said it represents $140 million of economic activity in Michigan this year.


"This is a state that we've shown huge commitment to and we wan to show more commitment to," Maron said.


Gov. Snyder has until Oct. 21 to act on the bill. Dave Murray, Snyder's spokesman, told MLive last week that it is being reviewed.


Nesbitt, one of the bill's sponsors, maintains that though the bill's been amended, it has nothing to do with Tesla. He said he thinks Tesla is "using this as kind of a red herring to talk about their issue, which is already covered under current law."


Burns, of the Auto Dealers, said that the amendment was to clarify the bill's application to all deals, as some have tried to claim exemptions in the past. It doesn't represent a regulatory change, he said.

Ad Loading...


"All the original equipment manufacturers in the world that do business here comply with the law, and it's worked very well," Burns said last week.


Maron said that even in its pre-amended form, the bill should raise consumers' eyebrows. He said it is designed so that dealerships can tack on additional fees to the purchase price for all vehicles.


"Those are the kind of fees that we as a company don't ever charge. They're controversial," he said, adding, "The whole thing here is anti-consumer."

More Industry

Photo of gray SUV plugged into public electric-vehicle charger in parking lot
Industryby Hannah MitchellJuly 21, 2026

World EV Adoption Set to Grow

A new report says the segment, despite recent setbacks in some regions, is poised for acceleration as many countries look to reduce pollution.

Read More →
Bar chart of truck and SUV segments' weekly value change
Industryby StaffJuly 21, 2026

Black Book: Weekly Market Update

Wholesale automotive auction business stayed steady last week as bidders encountered lower prices, analysts observed.

Read More →
laptop with blue car on screen on a shopping website, Clear Costs Convert
Industryby Lauren LawrenceJuly 21, 2026

Pricing Transparency Drives Purchase Consideration

An annual study by JD Power found that clear pricing matters to consumers on automaker websites, so much so that it increases their purchase consideration.

Read More →
Ad Loading...
Bar graphic of used-car segment weekly change
Industryby StaffJuly 14, 2026

Black Book: Weekly Market Update

Used-vehicle market depreciation was the prevailing story in the wholesale market last week.

Read More →
Light-blue Fiat car parked on a sunny Chicago street
Industryby Hannah MitchellJuly 14, 2026

Smaller Is Looking Better

A growing number of Americans in the market for a new vehicle are opting for more affordable options, not waiting for market stability to bite the bullet.

Read More →
man sitting at desk using calculator with charts in front of him, to-go coffee cup on desk, rising and falling data chart in front
Industryby Lauren LawrenceJuly 14, 2026

U.S. EV Market Slowly Stabilizes

U.S. electric-vehicle interest is slowly stabilizing since a major dip in sales after last year's end of the federal EV tax credit, and hybrids remain the leading electrified power train.

Read More →
Ad Loading...
blue background, map of the world with connecting lights and an electric vehicle emblem in the middle
Industryby Lauren LawrenceJuly 8, 2026

Global EV Market Entering New Phase

Automakers are making investments to lower battery costs and optimize production to meet changing consumer needs.

Read More →
Bar chart showing week-over-week wholesale automotive price change
Industryby StaffJuly 7, 2026

Black Book Weekly Market Update

The holiday weekend, not surprisingly, put a drag on wholesale automotive activity last week, analysts observed.

Read More →
Photo of Honda CR-V SUV on two-lane road next to roadside trees
Industryby Hannah MitchellJuly 1, 2026

Auto Affordability in Context

Cox Automotive points out the complex circumstances that have led to eye-popping vehicle prices.

Read More →
Ad Loading...
Line chart of used-vehicle days to turn over past week
Industryby StaffJune 30, 2026

Black Book: Weekly Market Update

Automotive auction inventory increased last week, giving choosy bidders even more leeway.

Read More →