Mississippi’s electric vehicle bill passes the House and goes to Gov. Reeves

By Joseph Jr. On Mar 3, 2023

Mississippi’s state senate has passed a bill that would bar electric car companies from opening dealerships in the state.
Proponents of the bill say the law would uphold more than 50 years of precedent. Opponents say it’s “protectionism,” when lawmakers intervene in the free market to reduce the impact of an emerging industry on existing businesses.
The bill now goes to the office of Republican Gov. Tate Reeves.

JACKSON, Mississippi – A bill that would block the expansion of the electric car industry’s footprint in Mississippi is set to become law after passing the Mississippi Senate on Thursday.

The legislation now heads to the office of Republican Gov. Tate Reeves, who has not indicated whether he will sign it.

House Bill 401, which has received both bipartisan support and opposition, would interpret state franchise laws to say that automakers cannot operate their own dealerships and must work with franchisees. This is in direct contrast to the business model used by electric car manufacturers such as Tesla and Rivian.

Electric car manufacturers can open dealerships in Mississippi if they’re willing to change their business models. In an interview in January, Bo Whiteman, Rivian’s senior policy adviser, said the company would not move to a franchise model, meaning Rivian would be effectively barred from opening a dealership in Mississippi if Reeves signs the bill. .

“Mississippi consumers will be forced to work without a physical presence, and that will hurt them,” Whiteman said.

In January:Wyoming lawmakers push to ban and limit sales of electric cars by 2035

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Tesla’s current Brandon location is grandfathered in and can continue to operate, but the company hasn’t been able to expand its footprint.

What do supporters and opponents of the bill say?

State Sen. Jeremy England, R-Vancleave, said he has spoken with Tesla officials about the possibility of opening a second physical location on the Gulf Coast, but the plan to become law would prevent them from doing so.

“I want them to bring their work to Mississippi,” England said.

Proponents of the bill, such as Sen. Daniel Sparks, R-Belmont, say its goal is to ensure that traditional automakers and electric manufacturers play by the same rules. Sparks also said the bill would uphold more than 50 years of precedent, under which car dealerships operate as franchises rather than as direct assets of automakers.

“If they want to own dealerships in this state, they have to follow the franchise laws that have been in place for over 50 years,” Sparks said.

However, the attorney general advised that Tesla would not violate franchise laws before opening the Brandon store. This divided the legislature.

Protectionism or respect for rules?

Sparks believes the opinion was wrong and the law needs to be clarified through this bill. Opponents of the bill, such as England and Sen. Joey Fillingan, R-Sumrall, say it’s “protectionism” — interference with the free market to reduce the influence of emerging industries on existing businesses.

“I think if we’re not careful because of the rules of cooking at home and wanting to be friends with people we’ve already been friends with … we’re really depriving the citizens of our country of new technologies. . it will be in all the other 49 states,” Fillingane said. “With or without good intentions, we can deprive our citizens of the opportunity to own an electric vehicle.”

More:California plans to ban sales of new gas-powered vehicles in 2035. 17 states decide whether to follow it or not.

England compared this move to other hypothetical forms of protectionism adopted by the legislature when new technologies came into the country.

“If we’re passing a bill to support Netflix versus the local mom-and-pop video store saying, ‘Hey, we’re okay with you showing movies to consumers around the world. Mississippi,” England said. “We tell you, you should do it on DVD because Mississippi has something like this and our family video libraries support local communities and so on. It sounds silly, but that’s what we do.”

England proposed a number of amendments to the bill, including efforts to allow Tesla to open a second site and allow the bill to expire after two years. Every amendment he made failed.

After questioning Sparks and moving the amendments, and after more than an hour of debate on the bill, England rose to object. That drew the ire of some of his fellow senators, but England said it was important to reiterate his opposition — calling it the “worst bill” he’s ever seen on the State Senate floor.

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