A new bill could impact Tesla’s waiver to make direct sales in New York, prompting the manufacturer to consider closing all dealerships in the state.
Several states have laws that prevent electric vehicle manufacturers from selling directly to drivers. Instead, electric vehicle brands like Tesla, Lucid, Scout Motors, and Rivian must go through third-party dealerships.
This process is in place to protect dealerships from their manufacturers. For example, if a Tesla opens a direct-sales site next to a privately owned Tesla dealership, the third-party dealership could lose sales.
Why could a new bill impact Tesla in New York?
Despite the anti-direct sale law still in effect in New York, Tesla pushed back and scored a waiver, which allowed it to open several locations across the state.
However, former Tesla ally New York Senator Patricia Fahy has introduced a motion to revoke Tesla’s waivers by 2026, according to the Daily Beast—the same one she helped the brand acquire initially.
Fahy proposes that Tesla relinquish its licenses for its five New York locations, which would then be distributed to electric vehicle competitors, such as Rivian, Lucid, and others.
Why did Fahy change her mind on Tesla?
Fahy’s change of heart comes after Tesla CEO Elon Musk’s allyship with President Donald Trump. Many Tesla dealerships, including the showroom in Manhattan, N.Y., have been the target of protests against Musk’s involvement in Trump’s Department of Government Efficiency (DOGE).
Fahy initially supported the electric vehicle manufacturer’s direct-sale waiver to reduce emissions in New York. However, Musk’s support of Trump’s efforts to roll back environmental regulations has led her to change her tune.
“No matter what we do, we’ve got to take this from Elon Musk,” Fahy told Politico. “He’s part of an effort to go backwards.”
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