Photographer: Michael Short/Bloomberg

Tesla Wins Right to Open Virginia Store in Win Against Dealers

  • Virginia DMV commissioner says no independent dealer available
  • Expanding retail footprint key as company prepares for Model 3

Tesla Motors Inc. won the right to open a second store in Virginia, prevailing over opposition from auto dealership owners in efforts to expand its retail footprint ahead of introducing the mass-market Model 3 sedan.

“There is no dealer independent of Tesla in the community or trade area of Richmond, Virginia, to own and operate a Tesla franchise in a manner consistent with the public interest,” Richard Holcomb, Virginia’s Department of Motor Vehicles commissioner, wrote in a 9-page decision Wednesday.

Virginia law allows carmakers to own dealerships if they can show there’s no other qualified independent dealer that would serve the public interest. Tesla went through a similar process four years ago, and a 2013 agreement between Virginia, the state’s auto dealers’ group and Tesla permitted the company to open its outlet in Tysons Corner, a suburb of Washington D.C. The Palo Alto, California-based company is planning an expansion in the state capital of Richmond, along the dense I-95 corridor.

Tesla is cranking up pressure on states to allow the company to sell electric cars directly to customers. In September, the maker of Model S sedans and Model X sport utility vehicles filed a federal lawsuit against the state of Michigan to overturn its ban on direct sales by auto manufacturers. Tesla currently operates stores in 23 states and the District of Columbia as well as markets in Europe and Asia.

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