Mississippi enacted a new state law which prohibits electric car manufacturers such as Tesla, Rivian, and Lucid from selling vehicles in person unless they open franchised dealerships. While the bill grandfathers the single existing Tesla location in the state, any future locations would need to be franchised before being allowed to open.
Governor Tate Reeves signed House Bill 401 on Tuesday and stated in a post to Twitter that the bill was “fair” and necessary to protect the almost 200 small businesses in the state that would be threatened by large manufacturers entering the market without constraints that could “destroy their businesses.” However, he also acknowledged the inevitability of innovation in the industry and pledged to find long-term solutions for an “ever-changing market.”
I also recognize that innovation in this industry is inevitable. And with innovation comes new companies with new business models. I am committed to find long-term solutions—in an ever changing market. I look forward to working with all parties going forward to do just that.
— Governor Tate Reeves (@tatereeves) March 14, 2023
The bill does not prevent the sale of electric cars online, but it does require customers who wish to purchase in-person to drive to the state’s only Tesla store in Brandon. This store will be allowed to remain open under the new law, but Tesla, or any other electric car manufacturer, will not be able to open new retail locations to sell cars without first entering into a franchise agreement.
Before the bill passed it was the subject to rigorous debate among lawmakers. Opponents argued that it would hinder the automobile market and discourage electric car manufacturers from bringing new technology and jobs to the state. Those in favour argued that the law would ensure all car manufacturers play by the same rules, regardless of their business model.
“In today’s world, if you don’t innovate, you lose out. We as a state cannot afford to lose out. My vote against the bill was a vote for capitalism, competition and innovation rather than for a policy of protectionism,” Republican Sen. Brice Wiggins told The Associated Press.
