Tesla only EV maker allowed to sell directly to consumers under Washington state law

OLYMPIA – Tesla is the only electric vehicle manufacturer allowed to sell directly to consumers in Washington through an exemption to state law from 2014.

According to Rep. Beth Doglio, D-Olympia, other car manufacturers are not allowed to offer test drives, discuss pricing and financing options or purchase vehicles from a showroom after the state banned manufacturer-owned dealerships that year. The legislature was worried about competition for local car dealers.

Since Tesla had a dealer license in the state at the time the legislation was adopted, the company was essentially grandfathered in.

Attempts to modify state law to allow other Tesla competitors to sell their vehicles in the state have failed to gain support in the Legislature in recent years over continuing concerns the proposal could hurt car dealerships in the state.

During testimony before the House Consumer Protection Committee last month, Doglio criticized the Tesla exemption as creating an “uneven playing field.”

According to Doglio, Washington is the only state that allows Tesla to obtain an unlimited number of dealer licenses. Washington is also the only state on the West Coast that prohibits direct sales to consumers by all electric car manufacturers.

“This not only gives Tesla an unfair market advantage, but it also sets a concerning precedent for regulatory favoritism that discourages American favoritism and investment,” Doglio said of her proposal.

Tesla was the only electric vehicle maker seeking to sell its vehicles in Washington when the grandfathering was granted in 2014.

During a Feb. 14 hearing, representatives of Rivian, which also manufactures electric vehicles, testified that Tesla’s exemption limits competition and hurts consumer choice. A collection of businesses and groups, including Rivian, formed the Washington Clean Car Coalition this year and called for lawmakers to allow consumers to buy directly from manufacturers.

“Washingtonians should have the same opportunity as consumers in many other states on the West Coast: To make their own decisions about how they buy cars, and from whom,” Hannah Steinweg, public policy director for Rivian, said in a statement last month. “A level playing field among zero emission vehicle-only manufacturers is good for competition and good for consumers.”

During testimony before the Senate Labor and Commerce committee, Tesla’s Northwest Regional Sales Manager Ava Ames said removing the company’s exemption would “limit consumer choice” and would hurt the state’s “continued transition to sustainable transportation.”

“In order for prioritized, sustainable transport, we need to focus on inclusion, not exclusion,” Ames testified.

Ultimately, proposals that would have ended Tesla’s exemption, and a second proposal that would have allowed other electric vehicle manufacturers to sell directly to consumers, died in committee without a vote.