Rivian sues Ohio DMV over partial ban on direct au...

Rivian has filed a lawsuit towards Ohio’s Division of Motor Autos due to the state’s partial ban on direct automotive gross sales, The Verge reports. The corporate says that the ban “reduces competitors, decreases shopper selection and drives up shopper prices and inconvenience.” Rivian believes Ohio’s legislation is especially unfair as a result of it comprises a carveout for the corporate’s competitor Tesla.

Ohio currently requires the state DMV to not present a dealership license to “a producer, or a mum or dad firm, subsidiary, or affiliated entity of a producer, making use of for a license to promote or lease new or used motor automobiles at retail.” The legislation retains automotive gross sales within the fingers of independently owned automotive dealerships — aside from Tesla. An exception was created for Tesla in 2014, The Columbus Dispatch writes, after the EV maker reached an settlement with the Ohio Dealership Affiliation. Now automobiles within the state are offered by conventional automotive dealerships, and three dealerships owned and operated by Tesla.

“Rivian believes that customers ought to be capable of select the automobiles they buy,” Rivian’s Chief Administrative Officer Mike Callahan shared in an announcement. “Shopper selection is a bedrock precept of America’s economic system. Ohio’s archaic prohibition towards the direct-sales of automobiles is unconstitutional, irrational and harms Ohioans by lowering competitors and selection and driving up prices and inconvenience.”

The corporate’s lawsuit does a very good job of laying out the illogical scenario Ohio has created with its ban. Rivian is allowed to carry out repairs on automobiles within the state and ship automobiles bought out-of-state to Ohioans. “Nonsensically, the factor that Rivian can’t do is definitely full the sale of Rivian automobiles in Ohio,” the corporate writes. “This imposes a rare burden on Ohio shoppers and Rivian for no respectable purpose.”

As The Verge notes, bans on direct automotive gross sales have traditionally exist to stop massive, established automotive corporations from having a monopoly on the sale of their very own automobiles. Going direct to shopper is among the methods EV makers have differentiated themselves from older manufacturers, one thing corporations like Tesla and Rivian cannot do in states with bans. Rivian might attempt to strike a deal like Tesla, however submitting a federal lawsuit suggests the corporate might be aiming to win an even bigger, extra lasting change. Rivian has achieved related wins previously. The state of Illinois sued to stop Rivian and Lucid Motors from promoting on to shoppers in 2022, however finally misplaced.