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Zero-emission car manufacturers hoping to direct sell in PA

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A proposed plan in Pennsylvania would allow the manufacturers of zero-emission vehicles (eco-friendly) to sell directly to consumers and basically remove car dealerships from that auto buying experience.

Pennsylvania Senate Bill 1409; which contains the proposed legislation, and was sponsored by Berks, Chester, and Montgomery county senator, John Rafferty, has passed through the Senate and moved on to the House of Representatives.

While the bill is currently tabled in the House, a vote could be taken on this as early as this fall and would be a blow to franchised car dealerships.

This plan would allow a manufacturer like Tesla Motor, makers of electric vehicles, to own and operate their own sales center, with customers able to come in and purchase directly from their company. In other words, the state would be creating a direct sell model for certain automobile manufacturers.

Tesla, in an effort to prepare for this, has been working hard to establish retail sites in PA and has a plan in place to use space in the King of Prussia Mall for its first offering in the state.

The Pennsylvania Automobile Association is willing to concede this method of allowing zero emission vehicles manufacturers to enter the marketplace, with the understanding that the bill will compromise by limiting the number of retail outlets eco-car manufacturers can have.

Due to the fact that 85 to 90 percent of the cars sold in the state are from franchised dealership, many don’t think these manufacturers will be able to survive for the long term without eventually using their help.

They see the relationship as one in which the manufacturer needs the dealership to help with the sales of their product by adding extra benefits such as vehicle serving, customizing, detailing and auto body repairs.

A similar bill has already passed in New Jersey and it allows the manufacturer to operate four facilities, with at least one site offering vehicle servicing.

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