Tesla Ban: FTC Wants Michigan to Allow Direct Model S Sales

May 13, 2015 11:21 AM EDT | Matt Mercuro

Tesla has at least one supporter when it comes to selling cars directly to customers in Michigan: the Federal Trade Commission.

The FTC has asked Michigan to lift a law that currently bans Tesla from selling its cars to customers directly, according to the Detroit Free Press.

Last October, Governor Rick Snyder signed a bill banning automakers from selling vehicles directly to potential buyers in the state. The FTC has an issue with that law, however, as evident by an 11-page response letter sent to Senator Darwin Booher.

"Michigan's consumers would more fully benefit from a complete repeal of the prohibition on direct sales by all automakers," wrote the trade commission.

Booher had asked the FTC what it thought about SB 286, a bill that would let companies sell autocycles to customers directly. In the bill, autocycles are defined as "three-wheel motor vehicles" and "enclosed motorcycles."

The FTC isn't qualified to lift the ban itself, but it can advise states on what they feel is best for customers. In this case the commission clearly feels the bill is on the right track but on the wrong train.  

"The narrow scope of the bill would largely perpetuate the current law's protectionism for independent franchised dealers, to the detriment of Michigan car buyers," the FTC said in its letter.

There are currently 50 registered Teslas in Michigan, according to the Detroit News.

Earlier this month the Elon Musk-led company purchased Rivera Tool, a factory located in West Michigan that will be used to speed up production of the highly-anticipated Model X crossover.

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