New York lawmakers consider bill to ban Tesla’s direct sales

As Tesla was showing off its latest electric-car tech, New York state lawmakers were considering a set of bills that would overturn a state court ruling and bar Tesla from selling its cars directly from the factory. Tesla co-founder Elon Musk and the company warn if passed the bills would cost New Yorkers jobs — but passage might also force Musk to either escalate his running battle with car dealers or surrender.

As I've written before, Tesla wants to sells it cars much in the way Apple sells its tablets and computers — in well-designed shops with no middlemen. Auto dealers say that goes against decades of state laws and industry practice; they've sued to block Tesla in several states and challenged its plans in many others.

The results have mostly gone in the dealer's favor. Tesla has stores in 10 states and the District of Columbia where it can sell cars to shoppers; in a few more, such as Virginia, Tesla can't sell cars on-site, and has to direct customers to call California. In an unknown number of other states — including Texas, the second-largest market for new vehicles — regulators bar Tesla from selling at all.

The results give the electric car startup a taller hurdle to its business than any other automaker. Take the Washington, D.C., area; while Tesla has a store in downtown D.C., both Virginia and Maryland state regulators have blocked the company from opening similar stores in either state, leaving Tesla with no stores between D.C. and Miami.