Tesla’s unique business model allows them to sell vehicles directly to consumers through both retail locations and Tesla’s online design studio. Direct-to-consumer sales of its vehicles have led to some turbulence with existing car dealerships in many states, including Utah, Louisiana, Connecticut, Texas and Michigan. New Jersey allowed Tesla to open direct sales in the state in 2015, but with conditions. New Jersey’s legislation limited the number of direct-to-consumer dealerships per manufacturer to four stores and required at least one service center in the state. Tesla CEO Elon Musk once compared local car dealers to a mafia protection racket, stating in a Tesla blog post, “The rationale given for the regulation change that requires auto companies to sell through dealers is that it ensures ‘consumer protection’…Unless they are referring to the mafia version of ‘protection’, this is obviously untrue.”
Tesla recently launched a lawsuit to overturn a sales ban put into effect in Michigan in 2014 that prevents the Elon Musk-led electric carmaker from selling directly to consumers within the state. The greatest opposition against Tesla’s plea for direct sales in Michigan comes from both auto dealers and manufacturers, who argue that Tesla disrupts the traditional franchise dealership model.
Courtesy of Teslanomics.co
Ironically, Michigan and Texas which bans Tesla’s direct sales model have public pensions that are significant investors in the Silicon Valley company. However, that isn’t the only financial interest states have in Tesla. All states in the US rely heavily on sales tax to generate revenue. States without stores are forcing owners to purchase and service their vehicles out-of-state, missing out on sales tax in the process, a major revenue loss.
Source: Bloomberg, September 2016
Bill Wolters, of the Texas Automobile Dealers Association, is claiming that the introduction of Tesla into the Texas car market would “reduce competition”, and will incur costs for Texas. However, this argument assumes that dealers are creating added value for their consumers, and if that argument holds, then dealers should be able to keep customers in the market after Tesla enters. Additionally, Tesla is competing against other manufacturers and not franchises.
Racecar driver and environmental activist Leilani Munter protest’s North Carolina’s ban on Tesla’s direct sales model (Photo: Medium/Leilani Munter)
Out of a presumed 400,000 reservations for the Tesla Model 3, it is estimated that roughly half originate from the United States, according to the distribution of early Model 3 reservation data from Model3Tracker.info. Using a loosely estimated assumption of Tesla Model 3 reservations originating from banned states via Model3.ocasual.com, we get the following numbers: 1,250 in Louisiana, 2,980 in Connecticut, 3,076 in Utah, 15,670 in Texas, and 4,230 in Michigan.
The sales tax for Michigan is 6%, Louisiana is 9%, Connecticut is 6.35%, Utah is 4.7%, and Texas is 6.25%
This equates to a loss of $8,883,000 for Michigan, $3,937,500 for Louisiana, $34,278,125 for Texas, $6,623,050 for Connecticut, and $5,060,020 for Utah. That’s a total of $59,791,695 in loss revenue, which does not factor in current sales of Model S and Model X.
| States with Tesla Ban | Sales Tax | Estimated Tesla Model 3 Reservations | Projected state revenue loss (in dollars) |
| Louisiana | 9% | 1250 | $3,937,500 |
| Texas | 6.25% | 15670 | $34,278,125 |
| Michigan | 6% | 4230 | $8,883,000 |
| Connecticut | 6.35% | 2980 | $6,623,050 |
| Utah | 4.70% | 3076 | $5,060,020 |
Navigant Research believes that sales electric vehicles, including hybrid/plug-in hybrid, are set to comprise 9 percent of total vehicle sale by 2025. Currently, EVs make up 3% of total vehicle sales, but the number in 2016 saw a 36 percent increase in sales in the US alone. In 2016, 4,500 EVs were sold in Texas, 2,470 in Michigan, 270 in Louisiana, 1,452 in Connecticut, 1,132 in Utah, and 70 in West Virginia. Texas, Connecticut, and Michigan ranked among states with some of the highest EV sales. Of electric vehicles sold total in 2016, the Tesla Model S was the leading electric vehicle with ringing in at 29,156 vehicles. The Tesla Model S also outsold its entire class of vehicles, combined. Tesla is expecting high demand for Model 3, which will start at roughly half the cost of the Model S.
Source: Topspeed.com
There are currently 223,319 estimated Model 3 reservations in the United States, far greater than the sales of comparable vehicles. The BMW 3 and 4 series which sold around 106,000 vehicles in 2016 and the Mercedes C-Class sold around 77,000 vehicles in 2016. Tesla CEO Elon Musk is expecting to produce 500,000 vehicles in 2018 and tens of thousands this year (Tesla hasn’t released Model 3 production guidance for 2017). Musk’s expectations could make the Model 3 the highest selling vehicle in its class in both 2017 and 2018. The states that ban Tesla dealerships not only miss out on sales tax revenue from Tesla vehicles but in turn create an inconvenience for residents. By instating a direct sales ban on Tesla before the launch of Tesla Model 3, states will not only lose millions of dollars in sales revenue per year but also interfere with and disrupt free market competition and consumer activities.
Feature image courtesy of Delanman via Twitter.
News
Tesla Robotaxi app update now tells riders if Cybercab is the better choice
Tesla’s Robotaxi app now shows ETAs, wait times and availability for Cybercab and Model Y.
Tesla has rolled out a new vehicle selection screen in its Robotaxi app, and it puts the numbers riders care about most in front of them before they book.
Version 26.11.0 of the app shows the estimated arrival time, the expected wait and current availability for each vehicle option on a single screen, according to a video shared by @gheeunit on X on November 7. Riders deciding between a Cybercab and a Model Y Robotaxi can now compare those figures side by side instead of picking a car first and learning how long it will take afterward.
Tesla first gave riders that choice on September 3, the day paid Cybercab rides began in Austin. The original version of the screen listed the Cybercab, which seats two, next to the Model Y, which seats four. A later build, 26.8.2, added a seating capacity indicator so groups knew which car would fit them. What it did not show was whether choosing the Cybercab meant standing on the curb a few extra minutes.
Newest version of @robotaxi app has a new vehicle selector UI for choosing between Cybercab and Model Y and shows you the fare for both simultaneously! https://t.co/7qoDQ0vACX — mantequilla 🧈 (@gheeunit) November 7, 2026
That question matters more now than it did two months ago. Tesla had 45 Cybercabs on the Texas DMV roster when rides started. By late October the state listed 573, alongside 631 Model Ys, and community trackers logged a record 1,576 Cybercab sightings across Austin on Halloween alone. With two large fleets sharing one service area, the closest car and the quickest pickup are not always the same vehicle.
Inline availability also changes what happens when demand spikes. If no Cybercab is free nearby, the rider sees that on the selection screen rather than after trying to book one.
For now the comparison is mostly an Austin feature. Riders in Dallas, Houston, Fort Worth and the Florida markets are still matched with Model Y vehicles, though Tesla said on its third quarter earnings call that Cybercab rides would launch in Dallas this month.
The update follows a steady run of smaller changes to the rider experience. Late last month Tesla brought a quiet mode that blacks out the cabin screen to Model Y Robotaxis after first testing it in the Cybercab, and it has stretched Austin service to run from 6 a.m. to 2 a.m.
The Cybercab side of that selection screen is about to get much busier. Elon Musk said this week that Tesla will wind down Cybertruck production at Gigafactory Texas around the middle of 2027 to make room for more Cybercab output, and Tesla has said it is aiming to get Cybercabs to customers by the end of this year.
Tesla has not published official release notes for version 26.11.0.
Tesla is ending Cybertruck production sometime in mid-2027, according to CEO Elon Musk.
Musk made the announcement on X last night, which came as a shock to many. He said that the Cybertruck will end production “to make room for increased Cybercab production” at Gigafactory Texas.
It is a huge blow to the fans of Tesla who have come to love the Cybertruck and identify with it as a symbol of their fandom. It has been the best-selling electric pickup, but it has had an underwhelming sales performance in terms of what was expected. This is mostly due to Tesla not meeting the prices it planned to offer the Cybertruck, as its unveiling and actual release were four years apart.
Tesla will be winding down production of the Cybertruck at Gigafactory Texas around the middle of next year to make room for increased Cybercab production
— Elon Musk (@elonmusk) November 6, 2026
Overall, the responses were mixed. Some fans understood the move toward Cybercab production, especially as Tesla is truly pushing the autonomous future through its Robotaxi platform. However, others did not understand it.
“Damn, how many Cybercabs do you guys need?” one response read. Another said it was “Sad but understandable.”Even analyst Gary Black had responded to the news, stating he hoped Tesla planned to replace it with a traditional pickup design.
It doesn’t seem like that will be the case.
Tesla is so hell-bent on delivering autonomy and eventually providing a driverless service that owning a car seems like an arbitrary idea, according to their thesis. Instead, Cybercabs will be available to pick you up and drop you off on demand, safely, without any human help.
As a result, Tesla has thinned its lineup considerably, and one can only ask where the vehicle lineup goes from here. Eventually, it seems like Cybercab could be the only vehicle that Tesla will sell.
Elon Musk
SpaceX’s next Starship flight set to make history on Friday the 13th
SpaceX is targeting Friday, November 13 for Starship Flight 15 and its first ship catch.
SpaceX is targeting Friday, November 13 for Starship Flight 15, the mission the company plans to use for its first attempt at catching the ship itself with the launch tower.
SpaceX Vice President of Launch Kiko Dontchev shared the date on stage at the UP.Summit on Thursday, according to Ars Technica’s Eric Berger, who was in attendance. It is the first launch target to come directly from a SpaceX executive. Until now, the public schedule had relied on FAA air traffic planning slides, which listed Flight 15 for no earlier than November 8 and later November 12. SpaceX has not posted an official mission page yet, and no launch time has been shared.
The date lands inside the window Elon Musk sketched out last month. Speaking at Giga Texas on October 10, Musk said the flight would “probably launch a little bit before Thanksgiving,” as Teslarati reported. On SpaceX’s third quarter earnings call ten days later, he confirmed that Flight 15 would try to catch both the Super Heavy booster and the ship, and put the odds of a successful ship catch at “more likely than not.” SpaceX also aired an animation of the maneuver during that webcast, showing the ship swinging vertical over Starbase before dropping into the tower’s chopsticks.
The hardware is ready. Booster 22 fired all 33 of its Raptor engines for a full duration static fire at Pad 2 on October 25. Ship 42 followed with a single engine burn simulating a deorbit maneuver on October 26 and a 60 second firing of all six engines the next day, according to NASASpaceflight. Ship 42 had already rehearsed the catch in September, when the Pad 2 arms lifted it into position and crews connected the quick disconnect arm while the vehicle hung from the tower.
The remaining hurdle is regulatory. The FAA’s Starship page does not yet list a Flight 15 license. SpaceX President Gwynne Shotwell said in October that, after “significant constructive engagement with the FAA,” she expects the license to cover a return to the launch site and a tower catch for both stages. Bringing the ship home means a reentry path that heads toward land, rather than ending over open ocean as every Starship flight so far has.
SpaceX has caught Super Heavy three times, on Flights 5, 7 and 8, but the ship comes back from orbital velocity and has never been caught. Flight 14 on September 28 was the first Starship to reach orbit, deploying 26 Starlink V3 satellites before splashing down despite an early engine shutdown that Musk blamed on engine computer software.
Musk has called a successful ship catch “the first time that there’s been full recovery of an orbital class rocket,” and he has already named the step after it: a Flight 16 where both the booster and the ship fly again. NASASpaceflight reports that Ship 43, the next vehicle in line, is set for static fire testing in December.
Tesla Robotaxi app update now tells riders if Cybercab is the better choice
Tesla is ending Cybertruck production
