Assembly OKs direct Tesla sales in N.J.

Posted: June 18, 2014

TRENTON - The Assembly passed a bill Monday that would let manufacturers of zero-emissions vehicles such as Tesla Motors bypass auto dealerships and sell cars directly to consumers.

Lawmakers introduced the bill after the state Motor Vehicle Commission ruled in March against Tesla's direct-sales model and the company's chief executive, Elon Musk, accused Gov. Christie of cutting a "backroom deal" with the auto-dealer lobby.

Following the ruling, Tesla converted its two New Jersey stores to galleries, where the company cannot discuss price, take orders, or offer test drives.

Diarmuid O'Connell, Tesla's vice president for business development, praised Monday's 77-0 vote, with one abstention, as "an overwhelming message of support for consumer freedom of choice."

The bill has made for strange bedfellows: Before the vote, environmentalists, consumer advocates, and business groups held a news conference outside the Statehouse to support the measure.

"We're truly at a crossroads in history here when we have commerce and industry lining up with the environmentalists," said Assemblyman Tim Eustace (D., Bergen), a bill sponsor who owns an electric car.

John Galandak, president of the Commerce and Industry Association of New Jersey, said the proposal "embraces the spirit of the free-market economy, where ideas, innovation, and competition are encouraged rather than stifled by government regulation or laws."

Added Naved Husain of New Jersey Citizen Action: "When a company like Tesla Motors wants to sell cars in New Jersey, open showrooms, and hire staff, barriers must not be put up to prevent consumers from choosing how and where they want to buy their car."

Jeff Tittel, director of the New Jersey Sierra Club, called Tesla's Model S "the car of the century." He and other environmentalists said use of such cars would cut down on greenhouse gas emissions that diminish air quality and contribute to global warming.

The bill still needs to pass the Senate before it could head to Christie.

In other legislative action Monday, the Assembly passed a bill that would renew a cap on raises awarded through arbitration to police and firefighters.

The vote ended an impasse between Christie and Speaker Vincent Prieto (D., Hudson), who had sought to provide relief for public safety workers.

Prieto said Friday that he had struck a deal with Christie to renew the 2 percent cap, which took effect in 2011. The bill would extend the cap through 2017, and raises would be compounded annually.

The bill now heads to the Senate.

Also Monday, the Assembly passed a resolution declaring that the Christie administration's changes to the civil service system were inconsistent with legislative intent.

The Civil Service Commission last month established rules changing the process by which government employees are promoted. Employees are now organized into so-called job bands, groupings of titles for those with similar duties.

Once they are hired, employees no longer have to take exams to advance within the bands. Democrats and union leaders say that will result in cronyism.

The Senate already passed the resolution, which does not need Christie's approval. The commission has 30 days to amend or withdraw the rules, or the Legislature can pass another resolution invalidating them.


aseidman@phillynews.com

856-779-3846

@AndrewSeidman

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