Tesla Motors is fighting to be able to sell its cars in New Jersey after the state's Motor Vehicle Commission voted this week to ban company dealerships.
The vote will make the ban effective on April 1, meaning that New Jersey will join Arizona and Texas in banning Tesla's direct sales method, CNBC reported.
The proposed rule, which essentially makes direct auto sales illegal, will not allow New Jersey to renew Tesla's sales license and will force the two Tesla stores in the state to close, laying off employees and curbing further growth.
According to CNET, the regulation was endorsed by a New Jersey auto dealerships association.
The electric vehicle startup is fighting to head off the law, saying that New Jersey Gov. Chris Christie's administration has not kept an agreement to hold off on the action, The Wall Street Journal blog reported Tuesday afternoon.
"This is at the very least disappointing, if not outright outrageous, what's going on with our business in NJ right now," Diarmuid O'Connell, Tesla's vice president of business development, told WSJ by phone.
An administration spokesperson said Tesla should have known that New Jersey law doesn't allow for direct sales.
"This administration doesn't find it appropriate to unilaterally change the way cars are sold in New Jersey without legislation," the governor's spokesperson told WSJ. "Tesla has been aware of this position from the beginning."
Tesla officials reportedly only knew about the rule change in the last three days, unaware that the association of auto dealers was pushing an agenda.
"Clearly, a decision was made rather abruptly and certainly without any consultation with us," said O'Connell, as reported by WSJ. "There are a couple levels of bad faith and surreptitious behavior."
If the regulation is upheld, the Palo Alto-headquartered company will have to close New Jersey stores in the next few weeks.
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