Tesla Motors and Georgia = Jobs and Style

Your Georgia Desk:

Tesla Motors

Our Editor, Todd Rehm, included this story on Tesla Motors in our morning e-mail.  It is worth a stand-alone post:

Two Issues Worth Watching

Two issues before the Georgia General Assembly highlight the internal struggle within the Republican Party about the role of government in our economy and whether it exists to protect current businesses, or to foster innovation through deregulation and freer markets.

Tesla Motors hopes to win passage of legislation that would allow the niche automaker the ability to sell more cars in Georgia. From Urvaksh Karkaria at the Atlanta Business Chronicle, coincidentally a Tesla owner:

Unlike the rest of the auto industry, Silicon Valley-based Tesla (Nasdaq: TSLA) sells its $100,000 sedans directly to customers, bypassing franchised dealer networks.

For the past year, Tesla has been selling in Georgia under an exemption that allows the automaker to sell “zero-emission vehicles” directly to the public. That exemption, however, limits sales to 150 cars a year.

Legislation, introduced Feb 6 by Republican House Reps. Chuck Martin, Buzz Brockway and Earl Ehrhart, calls for that cap to be raised to 1,500 vehicles a year.

The Tesla-backed legislation is likely to draw fire from the state’s franchised dealers, who might view Tesla’s approach as a threat to their business model.

The legislation lays the groundwork for Tesla to expand its marketshare in a high-growth market.

The Peach State ranked fourth in the nation in the percentage of electric vehicle registrations, according to auto website Edmunds.com. Georgia was the only non-West Coast state, trailing Washington, Hawaii and California.

Even so, EV adoption is infinitesimal — accounting for just 1.1 percent of all vehicle car registrations in Georgia between January and November.

Tesla opened its first retail store Jan 19 and is scouting additional sites in in-town Atlanta and Alpharetta.

I was in Washington, DC recently, and being a car geek, photographed the outside of the Tesla store. Isn’t this what free markets look like and isn’t there a vacant storefront in, say, Johns Creek or Buckhead where these cars could find a market?

More than simply the effect such regulation has on a single niche automaker from California is the effect it will have on Atlanta’s technology economy.