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Rivian fighting OHIO for dealership License · Elon Musk Podcast

• 0:17
  Automaker Rivian has filed A lawsuit against Ohio's Bureau of
• 0:21
  Motor Vehicles after the agency blocked the EV maker from
• 0:25
  selling directly to consumers in the state.
• 0:28
  Now, Tesla can already sell vehicles like this this fashion
• 0:34
  directly to customers in Ohio. So what would stop Ohio or what
• 0:40
  would stop Rivian from doing the same thing?
• 0:42
  I don't know. This legal action challenges
• 0:45
  Ohio's decision to reject Rivian's application for a
• 0:47
  dealer license, which is required for in state sales.
• 0:51
  Rivian claims the denial violates state laws and unfairly
• 0:55
  protects traditional dealerships.
• 0:57
  So this dispute began when Rivian applied for a license to
• 1:00
  operate a showroom in Columbus. Great city, Been there much a
• 1:04
  bunch of times. This is where customers could
• 1:07
  purchase vehicles directly from the company.
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  The Ohio BMV denied the request, setting laws that prevent
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  manufacturers from competing with franchise dealers.
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  Now, Rivian argues those laws were intended to prevent
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  manufacturers from competing with their own franchises, not
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  to block companies that have no franchise network at all.
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  Rivian sells direct to customers.
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  There are no franchisees, Nobody buys a Rivian franchise, and
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  there's no Rivian dealerships, so dealerships don't mark up the
• 1:40
  price. Rivian sells directly to you and
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  that's it. And Ohio thinks it's OK to block
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  Rivian from doing that. Rivian says that the denial
• 1:51
  harms consumers by limiting how they can buy its own vehicles.
• 1:54
  If you want to spend $50,000, you should be able to spend
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  $50,000 is what they're saying. The company notes that without
• 2:01
  the license, though, Ohio customers must purchase Rivian
• 2:04
  models online and then arrange for delivery from outside of the
• 2:08
  stage, which complicates service and registrations.
• 2:12
  Ohio currently allows Tesla to operate under a similar
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  agreement. Borivian claims its own
• 2:17
  application received unequal treatment.
• 2:20
  Now, the lawsuit points to a broader legal battle in multiple
• 2:23
  states over direct to consumer sales.
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  Many states still have dealership franchise laws from
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  decades ago that restrict how automakers can sell vehicles.
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  Some go back to fifty, 60-70 years ago.
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  Newer EV manufacturers without dealership networks have fought
• 2:40
  with those laws, arguing that that they protect established
• 2:44
  dealers from competing rather than serving consumers.
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  In its court filing, Rivian states that Ohio's actions
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  contradict the intent of its motor vehicle laws.
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  The company says those laws were never meant to block entirely
• 2:57
  new manufacturers from selling to residents.
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  Rivian seeks a court order requiring the BMV to approve its
• 3:03
  license and allow in state sales without going through
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  independent dealerships. It would ruin the whole model if
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  they had to have independent dealerships to sell their EVs.
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  And Ohio's dealership groups have defended the existing
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  rules, saying they ensure fair competition and protect buyers
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  by providing local service options.
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  Rivian counters that it already owns and offers warranty service
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  and repair support in the state, though, and that it direct sales
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  models allows better pricing transparency and consumer
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  experience. The case in Ohio mirrors legal
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  disputes Rivian faces in other states, including Georgia and
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  Texas, where dealership laws prevent it from selling directly
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  to customers. Now, Rivian is also rumored to
• 3:47
  be building a manufacturing plant in Georgia.
• 3:52
  So if they can manufacture in Georgia, why wouldn't they be
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  able to have a dealership here? That's weird.
• 3:58
  Now, these cases have become a recurring obstacle for new EV
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  manufacturers, many of which aim to bypass traditional sales
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  channels entirely. Now, the outcome of Rivian's
• 4:08
  Ohio lawsuit could influence how other states handle similar
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  applications. Court ruling and Rivian's favor
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  might weaken the enforcement of dealership restrictions in
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  states with similar laws. And a loss could also strengthen
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  dealership lobbying efforts to keep direct sales banned.
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  Now dealerships that are lobbying against this, guess why
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  Rivian is a competitor. Rivian is new.
• 4:35
  They're sort of like the rugged Tesla.
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  They are sort of like the Subaru of Tesla.
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  If you want to go camping or something, you buy Rivian.
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  I mean Teslas are great for it. Sometimes Model YS are great for
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  it. Model X not bad.
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  Cyber truck weird, but also probably pretty good for camping
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  though it's all metal and that probably gets hot under the sun.
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  You don't want to be sleeping in the morning in a hot Tesla.
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  I know there's air conditioning, but if you set it up, a Rivian
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  is designed for those things. It's designed for camping and
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  glamping and being outdoors and climbing up mountains with a
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  thing. So they are sort of like the
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  Subaru without the love of E VS right now.
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  Now with that being said, the traditional dealerships are
• 5:32
  lobbying against Rivian because they see them as a threat.
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  If they didn't see this as a threat, then they wouldn't say
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  anything. They wouldn't care.
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  Just another car dealership, not a big deal.
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  But because they see it as a threat and they see Tesla as a
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  threat too. And they have been lobbying
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  against Tesla doing direct sales in every single state.
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  And Tesla's been fighting them tooth and nail to be able to
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  sell in every single state. And Rivian has to do the same
• 6:00
  thing, even though Tesla has set legal precedent in Ohio.
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  So and Rivian is going to expand production and deliver their
• 6:11
  trucks and if SUVs across the US no matter what happens.
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  But the company also says that restrictive state laws slow its
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  growth in certain regions. So this lawsuit signals that
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  Rivien's willingness to confront these rules head on rather than
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  adapt its sales model to comply with them.
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  They're going to fight this, and they're probably going to win.
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  And, you know, if they win, consumers win, too.
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  And maybe this will just push companies like Ford, also
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  Subaru, like I mentioned before, all the big automakers to do the
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  same thing. Do you want the markup of a
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  dealership or do you want to buy direct from the manufacturer?
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  And the manufacturer would probably mark it up anyway.
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  But The thing is, do you want to buy from a dealership who is
• 7:04
  kind of slimy? Because most dealerships aren't
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  the best people to work with, to be honest with you.
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  So buy direct, order it online to see somebody real quick.
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  Be like, I want this vehicle, do you have it cool.
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  If not, can you get it in? Cool.
• 7:18
  OK, shipped to my house. It's a great thing.
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  So I don't see any problem with selling direct.
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  Everybody else sells direct with everything.
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  But I guess autos are a certain price range that people in power
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  don't want you to buy directly. Numerous reasons.
• 7:36
  Lobbyists, scummy lobbyists. Of course they want.
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  They don't want this to happen because they want all the money.
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  That's it. It comes down to money.
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  Follow the money and you'll see who's lobbying against this.
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  I'm all for EVs to be bought directly from the manufacturer.
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  Tesla, Rivian, everybody buy it directly from the manufacturer.
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  But also ICE cars buy those directly from the manufacturer
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  too. Let me know what you think.
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  If your podcast platform has comments, I want to hear from
• 8:10
  you. I want to know what you think
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  about Rivian selling direct to consumers.