Rivian is taking more than just electric vehicles from Tesla’s playbook.
The EV start-up, focusing on electric pickup trucks, is following in Tesla’s footsteps when it comes to selling their product. They are lobbying certain states to change the laws regarding how cars are sold in an effort to sell directly to the consumer. In many states, vehicles may only be sold through dealerships. they act as a middleman between the manufacturer and the eventual owner. They also take a cut of the profits.
AutomotiveNews reports that Rivian is actively lobbying the issue in Colorado. They want to bypass the traditional dealership model, and sell their trucks directly to consumers. It’s a model that Tesla already popularized, but not without their own difficulties. There are still many states where you cannot simply order a Tesla from the company’s website.
An amendment added to the bill Friday, Feb. 21, designed to prevent traditional automakers from opening up next door to their franchised dealers did little to quell retailers’ concerns about what they say are the potential risks should the bill become law.
“We’re not enamored with the amendment,” said Tim Jackson, president of the Colorado Automobile Dealers Association. “You can’t put lipstick on a pig. It’s still a pig.”
Why It Matters
The dealership lobby is both very large and very strong. They obviously want to protect their income source, even if it’s a bit outdated in today’s modern connected world. If Tesla and Rivian can bypass the old model, the whole dealership industry could be threatened. What would stop Ford or GM from selling cars directly from the factory? If a single automaker is allowed to cut out the dealer markup costs, and pass them on as savings, it’s a huge advantage. You can be sure that traditional car companies would want the same advantage.
Rivian is taking advantage of Tesla’s previous fights over this issue. When their first vehicles are produced later this year, they can already sell directly in a number of states. Arizona, Illinois, Massachusetts, California, and Florida allow direct sales already. Mighican is currently considering changing their laws. Rivian continues to lobby for changes in Colorado and Washington.