An ongoing lawsuit continues to complicate life for potential buyers of the Tesla Model 3, and the automaker’s other electric cars, who live in Michigan.
Tesla and the state remain locked in a legal battle over the state’s franchise law, which requires automakers to sell vehicles only via an independently owned and franchised dealership.
The Silicon Valley automaker operates all of its stores itself and does not use the traditional franchise dealership model.
It’s why Tesla stores crop up in shopping malls and various retail centers, but in the state of Michigan, that sales model has been banned.
Those who have placed online orders for a Model 3 electric car cannot have their cars delivered within the boundaries of the state of Michigan.
Instead, the Model 3 or any other Tesla vehicle, must be delivered to a Tesla retail store in neighboring Illinois or Ohio.
Buyers must then work with that store to arrange pickup or delivery of their new vehicle, on which Michigan remains happy to collect taxes and registration fees.
The suit has evolved into a high-profile legal battle since Tesla is challenging a long-standing state law that was revised specifically to exclude it in 2014.
Michigan has deemed it illegal for automakers to operate their own dealerships, citing 1981 laws against vertical integration in the industry.
The revisions to the state law, signed in 2014, effectively outlawed Tesla from doing business in Michigan, although the state says it believes the revisions were minor at most.
“Tesla wants special treatment and refuses to bend to Michigan’s law,” the state wrote in a court filing.
“Indeed, Tesla insists that Michigan should bend to Tesla’s innovative business plan and practices rather than Tesla altering its practices to comply with Michigan law.”
While Governor Rick Snyder signed the revisions into law in 2014, he has encouraged state legislators to explore the “a healthy, open discussion” on the topic.
The goal of such discussions would be to determine whether Michigan’s laws should be tweaked to allow Tesla to deliver cars within the state
At the time, he said any changes to the business model should benefit Michigan consumers, first and foremost.
Those involved in the lawsuit say there is “no prospect of a settlement” on the horizon, and both parties have geared up for a long legal battle that has the potential to set precedent.