[MCRed]

I believe that this law is in direct violation of the commerce clause[1]. The commerce clause was designed to prevent tarrifs from being placed on products from one state being sold in another state. They wanted to prevent inter-state trade wars. Being forced to go thru a dealer network that (theoretically) adds no value while extracting a cut of sales is a form of a tarrif (or at least, I think it is arguably one).

Therefore, I think it might be time for Tesla to take this up as a federal matter.

I believe Tesla's constitutional rights are being violated in the states that do not allow them to operate their own stores.[2]

[1] "Congress shall have the power to regulate commerce ... among the several states ..." At the time the constitution was written, the definition of regulate was something like "to keep free of obstruction, to allow to occur without hinderance".

[2] This is completely separate from regulations that require car stores to operate safely, e.g.: if the state required that service departments have barriers around pits to keep people from falling in, that would be fine, and Tesla could comply when they open a service department. But forcing a business model on people is quite different from protecting public safety.

[abtinf]

Michigan is not discriminating against Tesla. They are not saying "only Tesla may not sell direct to consumer." Instead, they are saying "No auto manufacturer, regardless of their state, may sell direct to consumer." Thus, no commerce clause violation.

[drivingmenuts]

http://www.engadget.com/2014/07/17/tesla-motors-us-sales/

Decent article summarizing why Tesla can't sell directly.

TLDR: Because auto dealers don't want to have to compete directly with manufacturers.

Which makes no sense, seeing as how Tesla doesn't have any dealers that would compete with them, selling their own cars.

I like the guy I bought my car from on one level, but if it saves me money on my next car purchase, well, so long dealerships.

[bmh_ca]

The commerce clause may be violated if the effect is discrimination.

"It is the effect upon commerce, not the source of the injury, which is the criterion." - N.L.R.B. v. JONES & LAUGHLIN STEEL CORP., 301 U.S. 1 (1937) [http://laws.findlaw.com/us/301/1.html]

[gknoy]

What would stop Musk from making a company whose sole purpose was to be a Tesla dealership? It would buy cars from Tesla, sell to consumers, and sell Service Arrangements with Tesla, etc.

[adamfeldman]

Usually the dealer laws prohibit manufacturer-owned dealerships

[poizan42]

What about a common owner then?

[mandeepj]

> Michigan is not discriminating against Tesla. They are not saying "only Tesla may not sell direct to consumer."

I think they took the safest approach

[toomuchtodo]

So Michigan could legislate that any business is not permitted to sell directly to consumers. Great state to live in.

[baddox]

This wouldn't be a violation of the commerce clause per se. The commerce clause just says that the federal government has the authority to regulate interstate commerce. In other words, the US legislature could pass a law prohibiting these restrictions on Tesla sales, and that law would be constitutional.

[abcabc321321123]

> The commerce clause just says that the federal government has the authority to regulate interstate commerce.

This is not completely correct. Let me expand a little bit even though it is not applicable here. There is something called the "dormant" commerce clause (also referred to as the "negative" commerce clause) doctrine. This doctrine basically prohibits states from favoring in state commercial actors at the expense of out of state actors. Think protectionist legislation. Therefore, there is a lot more to the commerce clause than simply allowing the federal government to regulate interstate commerce.

[baddox]

Ah yes, I have read about that before, but had forgotten it. It basically seems like a shortcut whereby federal courts can rule against certain state laws without the need of a specific federal law. It seems in practice to be as if Congress, as authorized by the Commerce Clause, had passed some blanket law banning protectionist state laws.

[ctdonath]

"Regulate interstate commerce" was sent to hallucinogenic new levels with the Supreme Court ruling in the Raich case. TL;DR - feds can "regulate" (via SWAT-type police raid) a terminally ill old lady's doctor-prescribed-and-monitored state-legal for-personal-use-only marijuana plants because her doing so decreased demand in an illegal interstate market.