Tesla continues to challenge states across the US to operate its own dealerships, moving away from the long-standing franchise model. North Dakota is the latest state to become a focal point in this ongoing dispute.

The leading US electric vehicle manufacturer aims to open dealerships in Bismarck and Fargo. However, north dakota currently prohibits automakers from owning their dealerships, mandating that vehicles be sold exclusively through franchised dealers.

In its recent lawsuit, Tesla asserts that it does not fall under the state's legal definition of an automaker, which describes a manufacturer as one who assembles or imports vehicles and sells them to dealers for resale. Consequently, Tesla cannot sell its vehicles directly within the state, compelling potential buyers to travel to neighboring states.

A Tesla sales and service center in Texas. Photo: Tesla

The North Dakota Monitor reported that if the court determines Tesla meets the local law's definition of a manufacturer, Tesla will then request an exemption.

Assistant Attorney General Michael Pitcher stated that Tesla's interpretation would enable any manufacturer to circumvent the law simply by not franchising dealerships, adding, "that would break the entire regulatory structure that the legislature passed."

Pitcher also noted that Tesla is free to operate in north dakota like any other manufacturer. The company could appoint dealers, enter into franchise agreements, and conduct sales through them. Therefore, the law does not impede Tesla's ability to do business but rather regulates its vehicle distribution model.

North Dakota currently lags behind most other states in electric vehicle adoption. Electric vehicles account for less than 2% of new car sales, and there are only 277 public charging ports statewide, including 5 Tesla Supercharger stations.

Across the US, approximately 15 states still prevent Tesla from opening official stores or service centers due to legal barriers related to exclusive dealership laws.

My Anh