Mississippi Gov. Tate Reeves has signed a bill this week restricting electric car manufacturers from selling vehicles in person unless they open franchised dealerships.
Reeves enacted into law House Bill 401 even after some defying calls from fellow Republicans in the Legislature to veto the measure.
The law forces electric car companies such as Tesla and Rivian to sell vehicles through franchises rather than company owned stores, which is how they currently operate.
“Almost 200 small businesses in communities across our state are seeking assurances that big manufacturers can’t just destroy their businesses. That’s fair!” Reeves, a Republican, said in a statement posted to social media. “I also recognize that innovation in this industry is inevitable. And with innovation comes new companies with new business models. I am committed to find long-term solutions—in an ever-changing market.”
The bill will not prevent the sale of electric cars as people will be able to buy them online, however, if for example they wanted to buy a Tesla, they would have to drive to the state’s only Tesla store in Brandon. This store will be allowed to stay open under the new law.
Tesla or any other electric car company could not open a new brick-and-mortar location to sell cars unless they enter a franchise agreement.
“In today’s world, if you don’t innovate, you lose out. We as a state cannot afford to lose out,” Wiggins told The Associated Press on Tuesday. “My vote against the bill was a vote for capitalism, competition and innovation rather than for a policy of protectionism.”
With the pressing need for the world to make the transition to EVs to reduce emissions, this law may only set us back a few steps. Customers may be more reluctant to buy a car online and those companies that do not have the scale to franchise may move to other states and take money away from the economy.