Electric vehicle company Lucid Group Inc. fights back against Lone Star State’s rules on auto dealerships. According to a federal complaint filed by the EV maker, the state’s car dealership regulations are similar to “economic protectionism,” making it challenging for startups to market and sell vehicles in Texas, as per Teslarati.
In a lawsuit filed in Austin, the automaker claimed that Texas engages in anti-competitive behavior by requiring businesses to sell their products through established dealerships.
The electric vehicle maker also stated that due to the close relationship between its direct sales and in-house after-sales service, the independent franchised dealers’ utilization would damage its business.
Lucid’s lawsuit against Texas’ dealership rules
“That tight and fast feedback loop, and the benefits it brings to Lucid’s customers, would be impossible with third-party dealers interposed between Lucid and consumers,” wrote Lucid.
For its part, Lucid did not issue a comment about the matter as of writing. According to Bloomberg, the company’s lawsuit against Texas’ dealership rules comes amid the automaker’s struggles with business expansion.
“This prohobition is pure economic protectionism for the benefit of Texas’ existing auto dealers,” wrote Lucid lawyers in a pointed court briefing.
“It puts their profits ahead of the interests of Texas consumers.”
Lucid’s Air luxury sedan
Currently, the company only offers one vehicle, the Lucid Air luxury sedan, which costs more than $100,000 for now. Lucid could only deliver 1,398 Air sedans in Q3 despite the automaker saying over 37,000 reservations were made in Q2.
It is also worth noting that the company has adjusted its production goals twice this 2022.
Meanwhile, though the battle against dealership rules in Texas may seem fruitless, Lucid is following a playbook that’s been used successfully by other EV makers in the past.
Tesla’s success in Michigan
For example, Tesla succeeded in Michigan after more than three years of litigation. Due to the automaker’s efforts, Michigan Tesla owners can now buy vehicles and have them serviced in the state.
On the other hand, Texas is completely different, as even Tesla, which has headquarters in Austin, is still unable to sell its vehicles directly to consumers in the state.
Lucid’s ‘In the Air — and Beyond’ event
On November 15, Lucid will hold an exclusive online global Lucid launch event to highlight new models that will round out the full Air lineup, Air Sapphire’s latest developments, and the company’s reimagining of the luxury SUV segment.