Thursday, October 23, 2014

Dan Gilbert Takes Shot At Gov Rick Snyder For Telsa Motors Sales Ban

Dan Gilbert
Detroit billionaire Dan Gilbert the other took a shot at Gov. Rick Snyder for signing a bill that ensures Silicon Valley automaker Tesla Motors can't sell cars directly to consumers in Michigan. 

As the main stream media only reports part of the story, it should be noted that every State Senator and every State Representative from both the Republican and Democrat parties, with the exception of Tom McMillin, voted for the direct sales ban.

Gilbert, who has stated in the past that  he's a fan of Snyder, brought the issue up while guest-hosting CNBC's "Squawk Box" and interviewing Dallas Mavericks owner Mark Cuban.

Gilbert said Snyder's move "sends a bad message" about the influence of lobbyists in lawmaking.

"To me you have to have a philosophy and you have to stick to it and you can't let your personal circumstances compromise that," he said.

He also criticized the powerful auto dealer lobby for battling Tesla, which wants to sell cars through "stores" instead of franchises.

"Why don't you man up and compete like everybody else does?" Gilbert said.

Adam Jonas, auto analyst with Morgan Stanley, agreed with Gilbert.

"As Tesla grows in significance and expands its sales network, we expect more debate at the Federal level on the double standard in the application of dealer franchise laws," Jonas wrote in a note to clients. "It's only a matter of time before something gives. We expect that in the next two to three years, this could likely mushroom into a national issue. We believe these laws exist to support the weakest link in the network."

But Sandy Baruah, president of the Detroit Regional Chamber of Commerce, supported the governor's action.

"The Chamber believes that the Detroit region, as the epicenter of the global automotive industry and the leader in next generation mobility, should have a business environment where all participants play by a common set of rules," Baruah said. "The Chamber supports the rationale Gov. Snyder utilized for signing this legislation and looks forward to the continued discussion the governor calls for."

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