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Scout Motors Wants The Feds To Obliterate State Franchise LawsScout Motors is pushing the US Department of Justice to obliterate state franchise laws protecting car dealerships. Just like Tesla and some other nontraditional automakers which have tried selling vehicles directly to consumers, Scout has run into a plethora of problems as powerful dealer groups try pressuring it into doing business their way.
You might start enjoying a tax break on your car payments.
Instead of just taking that sitting down, Scout Motors has sent a letter o the DOJ Anticompetitive Regulations Task Force, claiming “state motor vehicle franchise laws are anti-competitive.” The company wants the federal government to eliminate those laws in every state, allowing it and any other automaker to sell cars directly to consumers.
The company also claims in that letter that state franchise laws hurt everyone because they inflate vehicle prices and increase the cost of servicing.
Instead, Scout Motors, which is a subsidiary of the Volkswagen Group, wants the federal government to level the playing field, eliminating an archaic system designed to stifle competition and “protect entrenched special interests.”
Like many have argued over the years, Scout says state franchise laws were written decades ago for circumstances which no longer exist. It’s true that much has changed about the auto industry since such laws went on the books, but are they really hurting American consumers?
That’s a debate that’s raged for a long time. Tesla tried to make this case back in the day, but ran into a brick wall. We wonder if Elon Musk will speak up on the issue or if he will just provide commentary on virtual “companions.”
With the new Terra pickup and Traveler SUV coming out soon, Scout Motors wants to sell them directly to consumers instead of using dealers. But in some states that isn’t allowed. It’s the same problem Tesla has run into repeatedly.
What do you think, should the federal government make moves to annihilate state motor vehicle franchise laws nationwide?
Image via Scout Motors
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