For New Jersey residents, buying the world’s most aspirational electric car just got a lot harder. Thanks to a recent change in licensing laws in the Garden State, it will essentially be illegal for Tesla Motors [NASDAQ:TSLA] to sell its electric cars direct to customers on April 1.
You’ll note we used the word ‘hard’ rather than ‘impossible,’ because as many of our readers told us, there’s always a way to buy a Tesla Model S or Model X if you really want one. But just how tough will it be?
First, a brief recap. Last week we provided extensive coverage of a last-minute regulatory change in New Jersey which, come April 1, will make it impossible for automakers to sell cars to customers directly. Voted into regulation by the New Jersey Motor Vehicle Commission and supported in full by Governor Chris Christie’s administration, the new rule not only means Tesla won’t be able to sell to customers direct, but it will be prohibited from renewing its existing dealer licenses for the pre-existing Tesla Stores.
This means Tesla Motors, which currently sells direct to its customers, cutting out the middle man, will have to change its business practices or face shutting up shop in New Jersey altogether.
As anyone who has followed Tesla Motors and its larger-than-life CEO Elon Musk will testify however, neither Tesla Motors nor Musk are about to give up. Staying within the law but finding legal loopholes is becoming something of a speciality at the Californian automaker, and the case in New Jersey is no different.
First of all, come March 31, Tesla’s existing New Jersey Stores will cease trading as showrooms where people can pop in, ask questions, take a test-drive, discuss trim and ordering options, and make a reservation. The very next day, they will reopen as ‘Tesla Galleries.”
Unlike a Tesla Store, a Tesla Gallery isn’t allowed to sell you a car. The staff aren’t allowed to help you book a test drive, discuss ordering a car or even tell you pricing information.
What the staff can do, legally, is provide information about electric cars in general. Staff can chat about the impact of switching from gasoline to electric. They can discuss what it’s like to drive an electric car. They just can’t sell Teslas or help you get your first Tesla Grin.
Each Tesla Gallery will have a Model S on display, and Tesla will be able to sell tesla-related merchandise like T-shirts, bags, hoodies and other non-automotive goods. Ask to order a car there however, and you’ll be met with a polite reminder that Tesla isn’t allowed to do that any more.
Crossing the electric car border
Because of its relatively small size, people in New Jersey who really do want to test-drive a Tesla electric car can do so by visiting neighboring states and taking a Test-drive there. For most New Jersey residents who live near to New York City, that means a test-drive in New York.
While New York is considering similar anti-Tesla legislation at the behest of powerful auto dealer associations in the state, for now at least, New Jersey residents can legally get a Tesla test drive there.
For those further south, Philadelphia’s Tesla Store is an alternative place to visit and find out more about a Tesla.
Ordering your Tesla online
For New Jersey residents, it’ll still be possible to order their Tesla electric car online via Tesla’s online retail app. As long as you don’t order through a physical store, everything should still be legal.
But unlike more pro-Tesla states, you’ll have to arrange for your new Tesla electric car to be picked up out-of-state, or delivered direct from the Tesla factory via a shipping company.
Forget about handovers too — that, along with the Tesla Stores, will come to an end in New Jersey on March 31.
If going out-of-state isn’t possible, New Jersey residents ordering a Tesla will need to understand that things won’t be as easy for them as it would be in a pro-Tesla state.
For example, the car will arrive with temporary license plates at best. Registration, taxes, and other regulatory paperwork normally sorted out by a dealership will need to be filed by the individual. We’re pretty sure too that you can forget about any state rebates for EV purchases.
And final delivery inspections? You can forget those too.
Then there’s finance. New Jersey residents may find financing a difficult proposition unless they have a residency in another state, so paying full price — and funding a new Tesla electric car through a third party — may cause problematic for some.
Of course, buying a used Tesla electric car shouldn’t be a problem for any New Jersey resident. Like any other used car, you can buy a used Tesla in any number of ways, but like new cars, you won’t be able to get a used, approved Tesla direct from the automaker itself.
Auction sites, classified listings and of course, traditional ‘used car lots’ are all sources for any New Jersey resident as they are for EV fans in other states.
But without any way to check the health of the car officially, we’re suspecting many buyers will be put off.
For New Jersey residents who don’t want to go through the hoops of buying out-of-state or buying used, it’s worth noting that all hope isn’t lost for the Garden State.
Both Tesla Motors and pro-Tesla legislators are already working to address the state’s recent regulatory change, calling for the matter to be given formal, legislative rather than regulatory attention.
For now however, if you lust after a Tesla Model S or future Tesla Model S and you’re in New Jersey we have one simple piece of advice: act before the end of the month, and your sales experience could be just as easy as it is in other states.
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