Court okays Rivian to continue to sell cars directly to customers in Illinois

rivian factory
Credit: Rivian

Rivian can continue to be allowed by the law to sell cars to consumers directly in Illinois. This came as the court okayed the practice on the basis that Illinois has never really required vehicles to pass through dealerships.

The court ruling came from Associate Judge David Atkins. The judge dismissed a lawsuit by the Illinois Automobile Dealers Association (IADA). It challenged the secretary of state for granting both Rivian and Lucid dealer licenses.

Unlike some other states, Illinois does not explicitly ban direct car sales. Judge Atkin reasoned it allowed companies like Rivian, Lucid, and Tesla to sell directly to buyers in The Prairie State.

According to the ruling, “The Illinois legislature has had ample opportunity, and has at least once expressly considered explicitly prohibiting manufacturers of automobiles from being licensed as dealers thereof. It has declined to do so, and it is thus reasonable to conclude that it had no such intent.”

Judge Atkin noted that most new car sales passed through dealers, but it had never been a requirement. He also added that even though dealerships were regulated in the state, the wording of the Established Franchise System suggested other selling arrangements.

The IADA has expressed its disappointment at the ruling and plans to appeal.

The dealership system has come under threat with the emergence of EVs. Ford and GM are having issues with their new terms for dealerships to sell electric vehicles.