Tesla bill moves forward after compromise

By Shelby Mullis

INDIANAPOLIS — Lawmakers reached a compromise that will keep Tesla Motors in the Indiana auto industry.

The legislation in its original form would have prevented auto manufacturers from selling directly to the public.

File Photo of a Tesla. Photo by Dustin Beach, TheStatehouseFile.com

Tesla owners came out in full force to testify against the legislation, because Tesla Motors sells its electric vehicles directly to consumers while other manufacturers, from General Motors and Ford to Subaru and Toyota, sell through dealerships.

But an amendment passed Thursday grandfathers in Tesla. With the exception of Tesla, Rep. Ed Soliday’s, R-Valparaiso, House Bill 1592 still specifically bars direct customer sales if more than 1,000 vehicles are sold or six years after the initial dealer’s license is granted.

The Roads and Transportation committee voted Thursday to pass the amended bill, 12-1.

“I think it’s something people will be equally happy or equally unhappy about,” Soliday said.

More than two dozen people, including O’Connell, testified both for and against the original legislation during a Wednesday committee hearing. Gene Voss, the owner of two Tesla vehicles, started working for at the Keystone Fashion Mall Tesla location when he saw Tesla’s impact on the auto industry.

“Because of what Tesla does and what they are continuing to accomplish, if they are no longer able to do business in the state of Indiana,” Voss said, “that technology no longer is here and the people who would be working on that technology no longer would have jobs here. They’d have to go somewhere else.”

While several people who testified against the bill, including Voss, called it a way of prohibiting the development of technology, Soliday disagreed.

Rep. Ed Soliday, who chairs the House Roads and Transportation Committee, listens to testimony on House Bill 1594. The bill would prohibit direct sales from a vehicle manufacturer to a consumer. Photo by Shelby Mullis, TheStatehouseFile.com

“Show me where in the bill that we are banning technology in the state of Indiana? That is offensive,” Soliday said. “If we pass this bill in current form, if Tesla does not do business in the state of Indiana, it would be Tesla’s choice. They have not been banned from anything.”

Soliday emphasized the bill is not a hit on Tesla, nor is it associated with General Motors, who lobbied for a similar bill authored by Rep. Kevin Mahan, R-Hartford City, last year.

Instead, the goal is to protect consumers from foreign markets, such as China, that are not required to meet the same standards as U.S. auto dealerships, supporters said. Dealerships keep drivers safe by keeping track of warranty records and servicing recalls, whereas Chinese manufacturers may not keep track of those records and look at quantity over quality.

While Rep. Wesley Culver, R-Goshen, said he loved the amendment that would allow Tesla to continue their business in Indiana, he voted against the bill because he wants consumers to have more choices.

But Toyota dealership owner Scott Jaeger supports the legislation, calling it a step toward protecting his business and consumers. Jaeger is the owner of Jaeger Automotive, Inc. in Terre Haute.

“Part of our business model is making sure we have time-tested systems in place to help protect and ensure the safety of these customers,” Jaeger said. “Every day, my employees negotiate with the world’s largest automakers to ensure fair prices and warranty coverage. We are on the front line of vehicle safety issues.”

In a statement released Thursday, Marty Murphy, the executive vice president of the Automobile Dealers Association of Indiana, said this legislation will protect Hoosiers and the nearly 50,000 jobs supported by Indiana auto dealers.

Shelby Mullis is a reporter for TheStatehouseFile.com, a news website powered by Franklin College journalism students.

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