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Tesla continues fight with auto dealerships in Arizona, Texas

Tesla's aggressive lobbying efforts in Texas continue to be met with opposition from groups representing franchised car dealers. Arizona lawmakers, meanwhile, appear to be moving in the direction of allowing direct sales from automakers like Tesla.

The battle between Tesla Motors and car-dealer groups has flared up again on two familiar fronts.

Both Texas and Arizona have seen skirmishes before between Tesla and groups representing franchised car dealers.

Franchised dealers, who have long enjoyed a state-mandated monopoly on retail car sales, appear to feel threatened by the automaker's direct sales scheme for electriccars.

Attempts by Tesla to sell cars in both states have failed so far, but that doesn't mean the debate is over.

That's literally the case in Texas, where a formal debate was held between representatives from the carmaker and the Texas Automobile Dealers Association.

Organized by the Texas Conservative Coalition Research Institute, the debate saw each side accuse the other of trying to create a monopoly, according to The Texas Tribune.

Ricardo Reyes--Tesla vice president of communications--argued that the current franchise system creates a monopoly for dealerships, and said keeping Tesla out of Texas only hurts competition.

He said it was odd that the only thing consumers can't buy directly in the state are "booze and cars."

But Bill Wolters--president of the dealer association--said Tesla was the one stifling competition, since only the company itself can sell the Model S.

He further claimed that if company-owned dealerships ever become widespread, carmakers would only operate dealers in "the most profitable, high populated areas" of the state.

Tesla CEO Elon Musk was also in Texas earlier this month fighting to change the state's franchise law, participating in a conference hosted by the Texas Department of Transportation. 

He suggested Tesla and lawmakers could work out a compromise similar to one arranged in New York, where the company operates five stores.

Musk indicated the number of Tesla Stores in Texas could be capped at seven, limiting the company's footprint in the state.

Meanwhile, in Arizona

While Tesla continues its aggressive Texas lobbying effort, Arizona lawmakers appear to be moving in the direction of allowing direct sales.

Current Arizona law requires carmakers to sell through franchised dealers, but a new billwould reverse that, The Arizona Republic reports.

House Bill 2216 is currently under consideration by the Arizona legislature and--as with pro-Tesla bills in other states--is vehemently opposed by car dealers.

A similar bill failed last year, but Tesla and its supporters hope that a new governor and legislature will be more receptive.

Supporters feel encouraged by kind words Governor Doug Ducey has had for companies like Uber, Lyft, and Apple--which recently opened a "digital command center" in Mesa.

Arizona was one of the states in the running for Tesla's battery-cell "Gigafactory," as was Texas.

Both states lost out to Nevada, which also made direct sales explicitly legal.

The Christian Science Monitor has assembled a diverse group of the best auto bloggers out there. Our guest bloggers are not employed or directed by the Monitor and the views expressed are the bloggers' own, as is responsibility for the content of their blogs. To contact us about a blogger, click here. To add or view a comment on a guest blog, please go to the blogger's own site by clicking on the link in the blog description box above.

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