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Tesla Finds Loophole Around New Mexico’s Ban On Direct Car Sales

Tesla has cleverly gotten around a New Mexico law that prevented them from selling and servicing their cars in the state. Up until now, New Mexico Tesla owners have had to drive out-of-state to get their cars serviced. There were also no Tesla stores in the state. Why? Because, like a number of other US states, New Mexico has a ban on direct car sales.

The ban stems from an old law used to protect car dealers in case automakers decided to start supplying vehicles directly to consumers. However, Tesla’s core business model revolves around selling directly to the consumer, with no middle-man car dealer involved. Up until now, Tesla has had no presence in New Mexico. They tried to enter the state in 2019 with the aid of a number of favorable legislators but were blocked from doing so when local car dealer associations campaigned against them.

However, it now appears Tesla has found a loophole. By partnering with a Native American tribe, Nambé Pueblo,  Tesla was able to build on their land – which is not subject to state law. Hence Tesla could open a new 7,000-square-foot service center and store inside the remains of a former casino north of Santa Fe.

Interestingly, Tesla could potentially use this loophole in a number of other states that have a ban on direct car sales. It just seems it’s a matter of finding the right tribal location, and then reaching a separate agreement with the tribe in question.

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