NADA Entering Legal Fight between Tesla and State Dealer Groups

Deal­ers don’t have good things to say about elec­tric car­mak­er Tes­la Motors, and this is com­ing through in law­suits. To smooth out the sit­u­a­tion, the Nation­al Auto­mo­bile Deal­ers Asso­ci­a­tion is seek­ing to meet with Tes­la and dis­cuss its retail net­work plans. “NADA has seri­ous con­cerns about Tesla’s inten­tions. We are seek­ing a meet­ing with Tes­la exec­u­tives, includ­ing its CEO Elon Musk, to dis­cuss these con­cerns,” NADA Chair­man William Under­riner said.

State deal­er groups in New York and Mass­a­chu­setts are suing Tes­la over its retail strat­e­gy poten­tial­ly vio­lat­ing state fran­chise laws, and Tes­la its defend­ing its strat­e­gy. The company’s strat­e­gy is need­ed to prop­er­ly edu­cate poten­tial cus­tomers about its elec­tric cars, Musk said in a blog post. Most recent­ly, a Mass­a­chu­setts judge decid­ed to con­sid­er whether to allow a Tes­la store in sub­ur­ban Boston to con­tin­ue nor­mal oper­a­tions. The Mass­a­chu­setts State Auto­mo­bile Deal­ers Asso­ci­a­tion request­ed a pre­lim­i­nary injunc­tion on its suit that was filed Oct. 16 claim­ing Tesla’s Nat­ick, Mass., store vio­lates the state’s licens­ing, con­sumer pro­tec­tion, and fran­chise laws. As for NADA, the asso­ci­a­tion thinks it’s a state-by-state deci­sion, and NADA will pro­vide legal sup­port to state deal­er asso­ci­a­tions if nec­es­sary.

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