Tesla and Ohio automotive dealers reach a compromise

Tesla has lately been losing its fight to keep selling cars directly to customers, but it just negotiated an important truce. The EV maker has reached a tentative deal with Ohio that lets it conduct direct sales in the state through a maximum of three stores. If passed into law, the agreement would also prohibit other car companies from trying the same strategy. 

Tesla Motors Inc. TSLA -3.39% struck a deal Wednesday with Ohio auto dealers that could allow the electric-car maker to ease a battle over its direct-to-consumer retailing model, at least for the near term. Under the agreement, Tesla would be allowed to keep operating two company-owned retail stores in the state, and open just one more. The deal requires approval from the Ohio state legislature. The proposed bill would bar all other auto makers from bypassing franchised dealers to retail cars. Diarmuid O’Connell, Tesla’s vice president of business development, said the compromise reached in Ohio should serve as a model to resolve fights with dealers in other states, where Tesla is confronting legislation and regulation aimed at outlawing its company-owned stores.

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