By Jimmy Vielkind 

ALBANY, N.Y. -- Electric-vehicle companies want New York lawmakers to let them open more dealerships in the state, a move that they and environmental groups said would expand sales of emission-free cars and trucks.

Representatives of Tesla Inc., Rivian Automotive LLC and Lucid Motors Inc. rallied outside the state Capitol Wednesday with environmental advocates and Democratic legislators as part of a push to change state law so electric-vehicle makers can sell directly to consumers.

Tesla currently has five dealerships in and around New York City, but state law prevents other auto makers from direct sales. The five dealerships were grandfathered in before a 2014 state law tightened requirements that vehicles be sold through independently owned dealerships.

As a result, New York has lagged behind in the number of electric vehicles sold, according to state Assemblywoman Patricia Fahy, a Democrat from Albany. She sponsors a bill that would remove the cap on dealerships owned by manufacturers and said she hoped it would mean more options for people who live in upstate areas.

"Where those dealerships go, the sales increase," she said.

Just over 12,000 electric vehicles were sold in New York in 2020, according to Atlas EV Hub, an analysis firm. Of that number, around 10,000 were sold at the five Tesla dealers and just under 2,000 were sold at traditional dealerships.

Laws completely prohibiting direct sales exist in 16 states, including Texas and Connecticut, according to the Natural Resources Defense Council, an environmental group that supports lifting those bans. The group says another 11 states, including New York, restrict sales.

Auto dealers oppose the legislation, and say electric-vehicle companies should operate under the same rules as other auto makers. Hermes Fernandez, a lobbyist for the New York State Auto Dealers Association, said in an interview that the legal change is unnecessary as traditional auto makers expand their production of electric vehicles.

"There is a distribution system now in place that has worked well, that supports competition and Tesla's arguments, at this point, are stale," Mr. Fernandez said.

Tesla officials declined to comment, and company representatives didn't speak at the rally. Rivian spokeswoman Leslie Hayward, who attended the Wednesday event, said the electric-truck maker wants to establish direct relationships with customers. She said the company was concerned traditional auto dealers, who derive significant revenue from servicing gas-powered vehicles, wouldn't prioritize the sale of electric vehicles.

John Bozzella, president of the Alliance for Automotive Innovation, which lobbies on behalf of traditional automobile manufacturers, said the pending legislation would "give certain companies special treatment in this very competitive market."

State Sen. Todd Kaminsky, a Democrat from Nassau County who sponsors the bill with Ms. Fahy, said it was important to expand consumer options.

"We want to have our citizens in New York have as much choice as possible -- whether it's going through a traditional dealership or direct sales," he said. "We think overall, the competition will allow more access to electric vehicles and lower the prices."

Representatives of environmental groups said vehicle emissions are currently the largest source of greenhouse gas in the state, and promoting electric-vehicle sales is necessary for New York to comply with a law mandating the state reduce emissions 40% by 2030.

A spokesman for Gov. Andrew Cuomo, a Democrat, said he would review the legislation.

Write to Jimmy Vielkind at Jimmy.Vielkind@wsj.com

 

(END) Dow Jones Newswires

May 12, 2021 17:16 ET (21:16 GMT)

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