New Mississippi bill limits EV sales to franchise system

Electric vehicles are quickly becoming a way of life in the U.S., but the way some automakers want to sell those vehicles is quickly becoming a flashpoint in some states. AP News reported on a new Mississippi bill that doesn’t ban EV sales but restricts how electric-only manufacturers can open new locations and sell vehicles in the state.

The state Senate approved the bill earlier this week, which seeks to bar EV manufacturers from opening new dealerships in the state unless they follow the same rules as everyone else. Governor Tate Reeves hasn’t signed the bill, but if it’s passed, it will close loopholes that allow Tesla to operate a dealer-but-not-a-dealer store in the state. Republican lawmakers blame the Biden administration’s push on EV incentives and credits for letting EV brands skirt the rules.

The automaker has one location in Mississippi that the state currently classifies as a store instead of a dealership. One Republican state senator said the setup allows Tesla and others to skirt the rules and get advantages legacy automakers don’t receive. “We’re saying if you choose to have a brick-and-mortar dealership, you have to follow the same laws that everyone else has to follow,” said Senator Daniel Sparks.

Buyers can still shop for EVs online under the bill, so Rivian, Lucid, and others can continue selling directly to Mississippians. Oddly, the legislation doesn’t aim to shut down the Tesla store some cited as the reason behind the bill. Still, new physical locations would be restricted to automakers willing to enter a franchise agreement.

Though it sounds harsh on paper, Mississippi’s bill isn’t actually all that restrictive and is less aggressive than measures proposed by some state dealer associations. The Illinois Automobile Dealers Association filed a lawsuit against Rivian and Lucid in late 2021, claiming their sales practices violated the state’s dealer laws. A judge dismissed the suit, but the Association has appealed the ruling. A bill in Georgia that would allow Rivian and others to sell directly to buyers stalled last year, despite the fact that the automaker plans to open a $5 billion factory there.

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