Electric Car Store Restriction Signed Into Law in Mississippi

The bill targets companies that sell vehicles directly to consumers instead of through a dealership.

March 16, 2023

JACKSON, Miss.—Mississippi Governor Tate Reeves signed a bill this week restricting electric car manufacturers from selling vehicles in person unless they open franchised dealerships.

AP reports that the law will force electric car companies such as Tesla and Rivian to sell vehicles through franchises rather than company-owned stores. The state’s lone Tesla store is grandfathered in and so will be allowed to stay open. Because this location is classified as a store, not a dealership, it operates outside state laws governing franchise businesses, which drew the ire of Mississippi car dealerships.

“Almost 200 small businesses [the number of new car dealers in Mississippi] in communities across our state are seeking assurances that big manufacturers can’t just destroy their businesses. That’s fair!” Reeves said in a statement posted to social media.

"In today’s world, if you don’t innovate, you lose out. We as a state cannot afford to lose out," Sen. Brice Wiggins, an opponent of the bill, told the Associated Press on Tuesday. "My vote against the bill was a vote for capitalism, competition and innovation rather than for a policy of protectionism."

New Mexico, Alabama and South Carolina ban direct sales and service center. Several, states, including Texas, ban direct sales. In Texas, consumers can buy Tesla vehicles online in California and have them delivered to their home at no extra cost.

Last year electric vehicles accounted for 10% of all new car sales, led by strong EV adoption in Europe and China.