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GM-backed bill could block Tesla in Indiana

General Motors Corp. supports a bill that could shut down Motors Inc. from selling its cars in Indiana. 

The GM-backed bill, which was authored by Rep. Kevin Mahan, R-Hartford City, could block auto manufacturers from selling cars directly to consumers. It appears that the bill is set to ban the all-electric vehicle manufacturer, Tesla. Its direct sales strategy is operating in counter to the traditional franchise dealer model. Meanwhile, the vehicle manufacturer runs a showroom at the Fashion Mall at Keystone. 

On Feb. 2, the House submitted a version of House Bill 1254, in which the issue will be sent to a study committee. However, a suggested amendment to the bill is to omit a study. It "provides that a dealer license issued to a manufacturer expires after 30 months," which causes the license of Tesla’s dealer to expire in 2018. The Senate Commerce, including the Technology Committee is set to carry the bill during a hearing on Thursday morning. 


Mahan said, "Its not about Tesla. Its about a level playing field," He added, "Tesla just happens to be the only manufacturer in the state working under this situation. But the thing is, with the technology forthcoming, not only in the United States, you could have another manufacturer pop up any time. So Im trying to close this loophole."

The Indiana authorities are potentially pushing the bill as Tesla is expected to launch a product that will tighten the competition with a new all-electric vehicle produced by General Motors. Earlier this month, Tesla reported it will start accommodating pre-orders for its Model 3 vehicles on March 31, and the anticipated delivery settled in late 2017.      

Furthermore, the expected cost of the Model 3 amounted about $35,000 before tax incentives. It suggests that it’s much cheaper compared to Tesla’s few all electric cars like the Model S sedan and Model X crossover, which comprises of a cost for over $100,000. Ahead of the price, the Model 3 is as well put in the same category alike with the General Motor’s Chevrolet Bolt, which is soon to be unveiled and anticipated cost settled at $30,000 after tax breaks. 

The general counsel for Tesla Todd Maron said, "General Motors is trying to kick us out of the state for purely competitive reasons," He added, "Their Chevy Bolt will be competing against our mass-market car, so they have timed this bill specifically so once we start selling the Model 3 against their Bolt, we can no longer sell in the state."


With dealerships, General Motors comprises of four facilities and includes about 49,000 employees and retirees in Indiana. 

On the other hand, Mahan stated that the bill addresses to all automakers that engaged in dealerships in Indiana and appears to make if difficult for them. 

Mahan said, "Its not a GM bill," He added, "Does GM have interest in it? Yes. Does Ford have interest in it? Yes. Does every dealer in the state of Indiana have interest in it? Yes."

A spokesman of General Motors Chris Meagher said that the proposed bill will be unfair for automakers other than Tesla, as it blocks companies from selling its vehicles directly to consumers, considering a franchise dealer are existing. It suggests that automakers such as General Motors, Ford Motor Co. and the other is unable to use business models of the Tesla in Indiana if they desired to. 

As the GM-backed bill could block Tesla in Indiana, tons of investors will likely watch out for signals about this company stock. You too can earn bigger profits and execute better trades here at Trade12 by reading the latest market updates on our official website, Striving to become the best forex broker for you, Trade12 reviews daily market events essential to your trading activities to help you develop a keen understanding of what is forex and certain trends involving stocks, currencies, indices, commodities, and metals. With all the positive Trade12 feedback from clients, you will be assured that your trading account is safe and secured.

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