Michigan Bill Seeks To Shut Rivian Out From Directly Selling and Servicing

timf

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I received the following email from Rivian today and it is very alarming. In short, the bill seeks to put into law the settlement Tesla reached with the state, giving Tesla an exemption but shutting down all future automakers from directly selling and servicing in the state, including Rivian.

Dear Rivian Community,

As you may know, the Rivian R1T and R1S were designed and engineered in Michigan and over eight hundred Rivian employees currently call The Great Lakes State home. Michigan is an important part of Rivian’s history and our plans for the future. Because of this, it’s important to let you know that a bill was introduced in the Michigan House of Representatives this week that, in its original form, would prevent Rivian and other manufacturers of all-electric vehicles (EVs) from conducting certain sales and service activities in the state.

While House Bill 6233 wouldn’t prevent Michigan residents from legally purchasing a Rivian online, it would inhibit our ability to create convenient sales and service centers throughout the state and additional jobs for Michiganders. As a Michigan resident and EV supporter, you have a powerful voice in the state government and can greatly help in our effort to stop this bill.

A committee hearing is planned for Tuesday, September 22nd, and the bill could get a full House vote later the same day or more likely, the next day. If you want more choice in how you purchase and service your vehicles, please email or call your state representative and senator directly to let them know you oppose House Bill 6233 as it was introduced.
  • Tell them where you live, so they know you’re a constituent.
  • Let them know if you’ve pre-ordered a Rivian or would like to one day.
  • Let them know why you support consumer choice and/or EVs.
  • Ask them to stop House Bill 6233 from advancing in the form it was introduced and instead support a change that would remove barriers to direct sales and service of EVs in Michigan.
Use the links below to look up your representatives’ contact information:
Michigan is one of America’s greatest places for outdoor adventure, and we are lucky to have customers like you that seek to keep it that way. Please help us prevent House Bill 6233 from being passed as introduced, empowering you as a consumer, creating jobs in Michigan, and putting Rivian one step closer to achieving our mission of Keeping the World Adventurous Forever. We appreciate your support, now and in the future.

If you have any questions, anything you would like to share, or want to get even more involved, please email us at [email protected]

- Team Rivian
 

ohmman

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This fight has been going on forever with Tesla as well. It reeks of GM's influence, as they have been behind the vast majority of these bills nationwide. I'm not a Michigan resident, but definitely agree that anyone who is should call their representatives ASAP and get on the record opposing this nonsense. Phone calls really do matter.
 

killjoy

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ohmman - How about justifying those false accusations? GM tried to sell & service online over 20 years ago during the dot.com boom and was denied by NADA and dealer franchise laws - the same ones Tesla, Rivian and other have been headbutting against. All traditional OEMs, foreign and domestic, have abided by those laws for multiple decades. Why does Tesla or Rivian think they're special and above the law? Why should the traditional OEMs, who were forced to invest in establishing expensive dealer franchises, suddenly be at a cost disadvantage if exceptions were made?

800 MI Rivian employees? I could of swore the company announced moving HQ and most of the company operations to CA just 3 months ago. Now you're pleading as a MI company? Which is it?
 

jjwolf120

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All traditional OEMs, foreign and domestic, have abided by those laws for multiple decades.
What was the purpose of those laws? If I recollect, the purpose was to prevent dealers from being put out of business by the car manufacturers after they had put in the time, money and effort to build up the business of selling the manufacturer vehicles. Since new car companies don't have established dealerships that have spent years building up the business, they shouldn't be forced to have dealerships.
 

electruck

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ohmman - How about justifying those false accusations? GM tried to sell & service online over 20 years ago during the dot.com boom and was denied by NADA and dealer franchise laws - the same ones Tesla, Rivian and other have been headbutting against. All traditional OEMs, foreign and domestic, have abided by those laws for multiple decades. Why does Tesla or Rivian think they're special and above the law? Why should the traditional OEMs, who were forced to invest in establishing expensive dealer franchises, suddenly be at a cost disadvantage if exceptions were made?
Yeah, I wouldn't blame this on the manufacturers but you'll find no sympathy here for the dealer franchise laws. Times have changed. Technology has changed. The vehicles themselves have changed. Manufacturing strategies have changed. Sales models have changed. Service models have changed. Now the laws need to change. If telegraph operators had lobbied as hard as the car dealers, landline and cellular telephones along with the internet would not exist and today's world would be vastly different.

Of course the fat cat dealership owners don't want any part of that change but they are wealthy and resourceful enough to weather the coming change if they embrace it and don't bury their head in the sand pretending it isn't going to happen. It IS happening.
 

killjoy

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What was the purpose of those laws? If I recollect, the purpose was to prevent dealers from being put out of business by the car manufacturers after they had put in the time, money and effort to build up the business of selling the manufacturer vehicles. Since new car companies don't have established dealerships that have spent years building up the business, they shouldn't be forced to have dealerships.
The purpose was to protect the 'good' and 'innocent' mom & pop dealers from the huge and 'evil' Big 3 manufacturers. Yes, agreed. Note that in relation to ohmman's accusations, dealer franchise laws were put into effect against GM, not for GM's benefit.

I understand and agree with your point on new manufacturers not having 3rd party dealerships, but the reality is those same dealership franchise laws that kept GM from selling directly in late 1990s are the same as being use against Tesla, Rivian, etc. So if GM and Ford cannot sell directly today, even in augmentation to their dealer network, why should these upstarts?

It just cracks me up that people blindly accuse the Big 3 of being behind dealer franchise laws when in reality they were put in place by the various US state governments to limit/constrain the Big 3. GM doesn't want dealer franchise laws. But I bet they do want a level playing field -- all competitors playing by the same rules and cost structures. Giving Tesla a free pass to bypass dealerships isn't a level playing field. If Tesla can sell direct, everyone should be able to... and the gov't would need to figure out how to make the legacy OEMs whole for the billions they've been forced to invest in dealers under the existing laws/model.
 

jjwolf120

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So if GM and Ford cannot sell directly today, even in augmentation to their dealer network, why should these upstarts?
Because they don't have existing dealerships that would potentially be put out of business. The question isn't why shouldn't they have to sell through dealerships, but why should they have to sell through a dealer network? Simply because existing car companies do, isn't a sufficient reason. The law was to protect dealers from their manufactures not to protect them from all manufacturers.

As a side note, Volkswagon already has an agreement with their dealers in at least Germany (not sure about the rest of Europe) to sell their electric cars directly to consumers.
 

ohmman

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ohmman - How about justifying those false accusations?
They're not false. GM started in 2016 lobbying against SB3 in Connecticut. They continued throughout 2017. Then they tried to do the same in Michigan, which is what this topic is about.

GM's lobbying against direct sales is on the record. I'm not making it up.


Unrelated heads up, in Xenforo, it's best to tag someone with @ because they'll get an alert that they've been mentioned. So instead of just saying ohmman, say @ohmman, and my bell will ring. :)
 
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DucRider

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If a manufacturer elects to set up franchised dealers, they should not be allowed to compete against them and potentially undercut them. This was the basis of almost all the laws that have been used, or sometimes modified, to prevent all direct sales by manufacturers.

But they should not be required to set up franchised dealers before they can sell.

Both the franchised dealer and manufacturer direct models have advantages and disadvantages. Having local inventory and service is a big plus, as is the choice to patronize a different dealer if for some reason one is not to your liking.
A reduction of the games that some dealers play to sell their services (very little revenue is from the actual sale of a new vehicle) would go a long way towards the distaste many have for franchised dealerships (in many States, Tesla stores hold dealer licenses and are technically "dealers").
I have near zero tolerance and will walk out at the first sign of any BS.

Manufacturers with franchised dealer networks are against direct sales simply because it is a tool they are not allowed to use plus getting it banned reduces competition. But have to wonder at least a little if the GM/Nikola deal was in part a way to backdoor direct sales for GM.
 

skyote

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But have to wonder at least a little if the GM/Nikola deal was in part a way to backdoor direct sales for GM.
Interesting thought, and quite possibly. I've wondered if any of the majors would spin out a dedicated EV brand & pursue a direct model, but it hasn't happened yet...
 

Joel

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Interesting thought, and quite possibly. I've wondered if any of the majors would spin out a dedicated EV brand & pursue a direct model, but it hasn't happened yet...
i totally agree. It’s fishy to me that all the Nikola drama comes to light after GM buys in. Seems a little bit like a power grab.
 

Joel

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ohmman - How about justifying those false accusations? GM tried to sell & service online over 20 years ago during the dot.com boom and was denied by NADA and dealer franchise laws - the same ones Tesla, Rivian and other have been headbutting against. All traditional OEMs, foreign and domestic, have abided by those laws for multiple decades. Why does Tesla or Rivian think they're special and above the law? Why should the traditional OEMs, who were forced to invest in establishing expensive dealer franchises, suddenly be at a cost disadvantage if exceptions were made?

800 MI Rivian employees? I could of swore the company announced moving HQ and most of the company operations to CA just 3 months ago. Now you're pleading as a MI company? Which is it?
I don’t get the hype about Michigan or Ca. I would have built in SC or AZ for all of the business. Clearly there is good deals and manufacturing in SC ,as Boeing is moving more of 787 and Volvo is building a new plant for the USA assembly of the XC90 all electric. Plus BMW and a whole bunch of parts manufacturers are in SC as well.
Honestly it would be interesting to see a cost break down per vehicle on Taxes and other charges just because of the location of the company.
just my 2 cents.
 

skyote

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I don’t get the hype about Michigan or Ca. I would have built in SC or AZ for all of the business. Clearly there is good deals and manufacturing in SC ,as Boeing is moving more of 787 and Volvo is building a new plant for the USA assembly of the XC90 all electric. Plus BMW and a whole bunch of parts manufacturers are in SC as well.
Honestly it would be interesting to see a cost break down per vehicle on Taxes and other charges just because of the location of the company.
just my 2 cents.
In MI, there is an extensive supply chain of component & part suppliers. Great place to collaborate directly with them (pre & hopefully post COVID).

Remember though, Rivian's factory is actually in IL.
 

Hmp10

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GM doesn't want dealer franchise laws. But I bet they do want a level playing field -- all competitors playing by the same rules and cost structures.
The playing field will never be level between ICE and EV cost structures. As battery technology advances, EVs will inevitably become cheaper to build than ICE cars. And EVs require far less ongoing maintenance, thereby lessening the need for a massive dealer service infrastructure. (Dealers make their profits largely off service, not sales.)

It is unreasonable -- and damaging to the consumer -- for GM or any other legacy manufacturer to demand a level playing field with EV manufacturers when it comes to cost structures.

Are you seriously arguing that needless costs should artificially be imposed on EVs manufacturers for the purpose of bringing their costs up to the level of ICE manufacturers?

If GM (or any other legacy manufacturer) wants a level cost playing field, then it should get serious about getting onboard with EV technology and getting its own costs down.
 

azbill

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If GM (or any other legacy manufacturer) wants a level cost playing field, then it should get serious about getting onboard with EV technology and getting its own costs down.
GM has invested in a new battery factory just for this purpose.
 

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