Mississippi bill restricting electric car dealerships could close state's only Tesla store

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Mississippi Gov. Tate Reeves will decide the fate of a bill passed in the state legislature Thursday aimed at restricting electric car manufacturers from opening new brick-and-mortar dealerships unless they comply with the same laws followed by traditional carmakers.

Introduced in the House in January by Rep. Tray Lamar, a Republican from Senatobia, the HB 401 now awaits a decision from the state's Republican governor, who has not indicated if he will sign the measure into law or not.

Shortly before it was passed in the Senate on Thursday, the bill sparked intense debate among GOP lawmakers, according to The Associated Press.

Opponents said it would betray conservative principles by setting a government policy that interferes with the automobile market, while supporters said it would ensure all car manufacturers play by the same rules, regardless of business model.


Republican Sens. Jeremy England, R-Vancleave, left, and Daniel Sparks of Belmont, listen as the Senate Clerk tallies the vote on House Bill 401 following a long floor debate in the Chamber at the Mississippi Capitol in Jackson March 2, 2023. (AP Photo/Rogelio V. Solis)

Opponents also expressed concerns that the bill, if signed into law, would stop electric carmakers from bringing new technology and jobs to the state.

Republican Sen. Joey Fillingane, of Sumrall, said the new implications could cause Mississippi to fall behind other states in the race to attract investment from electric car companies.

"Maybe we just like being last all the time. Maybe it’s a badge of honor — we’re the last ones to change," Fillingane said. "If we're not careful … we could deprive our citizens of opportunities they really ought not to be deprived of."


A low-angle view of a Tesla Motors logo at a U.S. dealership. (Smith Collection/Gado/Getty Images)

Tesla has one facility in Mississippi where customers can buy vehicles in person, but it is classified as a store and not a dealership – a distinction that allows the company to operate outside state laws governing franchise businesses. If the bill is signed into law, the store will not be allowed to stay open unless it enters into a franchise agreement.

Sen. Daniel Sparks, a Republican from Belmont, said the exception gives Tesla, and other electric car companies looking to take advantage of it special privileges that are not available to traditional automakers. 

"We’re saying if you choose to have a brick-and-mortar dealership, you have to follow the same laws that everyone else has to follow," Sparks said. "Please don't tell me Tesla's car doesn't identify as a car."

Republican Sen. Daniel Sparks of Belmont, explains the essence of a bill that would place new restrictions on car manufacturers for opening brick-and-mortar car dealerships. (AP Photo/Rogelio V. Solis)


The bill, which does not restrict the direct sale of electric cars since they can be purchased online, passed in a bipartisan 39-13 vote – with four Democrats and nine Republicans voting no.

The Associated Press contributed to this report.

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