• Wed. Sep 27th, 2023

Elon Musk and Tesla are getting around a direct-to-consumer sales ban with Tribal gamiong partners

Elon Musk and Tesla are getting around a direct-to-consumer sales ban with Tribal gamiong partners


and Native American gaming tribes are getting creative to provide more economic opportunity for the nearly-trillion dollar company as well as tribes that operate as business entities in some respects. They are bypassing antiquated auto dealer-protective laws at the level to sell electric vehicles directly to consumers.

What happens in might or might not stay in Vegas, but what happens on sovereign tribal land is, for the most part, outside the purview of state lawmakers or law enforcement officials regardless.

Cutting Out the “Middle Man”

In many states, automobile makers are only allowed to sell electric vehicles to consumers through licensed (third-party) auto dealers. The laws, in more than two dozen states, either direct sales or greatly limit them and were designed to keep manufacturers from trying to bypass established dealerships with what used to be a novel product. Direct sales are banned outright in almost 20 states.

Industry stakeholders like the Electrification Coalition, a purportedly nonpartisan, nonprofit organization, say the laws are outdated and they would seem to hinder the organization's goal of making it easier for consumers to get their hinds around the wheel of an EV. The coalition works with lawmakers and others at the state and federal levels.

EVs are not well suited for the dealership model. There is a lot more information to convey for EVs during the sale process; questions on things like range, how and where to charge, and available incentives. Learning these details and answering questions for each potential new buyer costs dealers time,” the Electrification Coalition notes in a section of its website, titled: “EVs and Consumer Choice”.

Among the states with outright bans on direct sales of EVs to consumers is Connecticut – wherein the Mohegan Tribe's reservation land is situated. On that reservation is Uncasville where the Mohegan Sun casino complex is located.

According to a 2021 (subscriber only) article in “The ”, the resort “attracts 9 million visitors a year, many of them drawn by the performers who play Mohegan Sun Arena, which opened in 2001. The arena has hosted some 3,000 paid events that have drawn more than 13.5 million guests. Twenty-seven major acts have launched tours at the arena“.

The tribe intends to partner with Musk's Tesla to open a “state-of-the-art Tesla Electric Vehicle showroom” sometime this fall. As the casino resort is not located “in Connecticut” but rather on sovereign tribal soil, state laws such as the ban on direct EV sales do not apply there.

In addition to serving as a delivery center for online Tesla sales pick ups, there will be a -service showroom inside the retail center known as The Shops, where visitors can shop for cars, kick the tires, and even test drive one or purchase one to drive off the site from the valet area of nearby Sky Tower.

Jeff Hamilton, president and general manager of Mohegan Sun said, “We're really excited about this new Tesla EV Showroom opening this fall at Mohegan Sun.

“This endeavor with Tesla marks an electrifying milestone in Mohegan Sun's commitment to fostering impactful relationships, promoting environmental sustainability, and offering cutting-edge experiences for our millions of annual guests.

Not The First Tesla/Tribal Partnership

In June, the Oneida Nation announced a partnership with Tesla to open a showroom at the tribe's sprawling Turning Stone Resort Casino in Upstate New . Tesla has also opened a showroom in New Mexico via an agreement with the First Nation of Nambe Pueblo. The tribe operates the Thunder Resort Casino nearby.

In addition to more than a dozen subsidiaries in the gambling business in the US, the Mohegan Tribal Gaming Authority d/b/a Mohegan Gaming & Entertainment also has ventures internationally including Inspire Integrated Resort Co., Ltd. in the Republic of Korea, MGE Niagara Entertainment Inc. in Ontario (Canada), and MGE Hellinikon B.V. in The Netherlands

Non-gaming assets include about half a dozen franchises in the Jersey Mike's sandwich chain as well as the Mohegan Holding Company also owns interests in sustainable energy resources, manufacturing, and technologies.

Source: Tesla Continues Partnering With Tribal Casinos for Vehicle Showrooms, CDC Gaming Reports, July 26, 2023

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