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Tesla, Rivian still face complicated direct sales laws across U.S. states

Credit: Alex Guberman at E for Electric

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Executives from both Tesla and Rivian have commented on the decades-long fight to overturn direct vehicle sales bans across many U.S. states, reigniting a long-held conversation in the electric vehicle (EV) community about dealership policy lobbying groups and online sales models.

Tesla has managed to side-step direct sales bans in many states through legal loopholes such as leasing-only models, processing purchases as out-of-state transactions, or simply opening stores in exempted tribal territories where the company’s stores will be exempt from dealership mandates. In other states, the company is still completely prohibited from selling vehicles, such as in Louisiana, where a U.S. appeals court just upheld Tesla’s right to sue the state over the direct-sales ban in August.

In Connecticut last July, Tesla managed to open a store on sovereign Mohegan tribal land, effectively side-stepping the U.S. state’s ability to prohibit direct sales. The Connecticut Automotive Retailers Association (CARA), a dealership lobbying group, immediately spoke out against the decision, though it gained support from Governor Ned Lamont.

Elsewhere, Tesla, Rivian, and many others sporting a direct sales model also face state store limits, and some executives have recently highlighted the decades-long fight to overturn these kinds of laws.

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Other states have bans on service centers, storefronts, or both, while some only allow Tesla to sell vehicles online, though they must make deliveries through a service center. The latter includes Texas, where Tesla’s headquarters is located and where it operates a U.S. Gigafactory. As for Rivian, it faces a similar situation through its Seattle retail “Space,” since company representatives are prohibited from sharing specific details on prices or receiving orders.

As such, the state-to-state laws can be difficult for EV companies like Tesla and Rivian to wade through and operate under, so it shouldn’t come as much of a surprise when they point to dealership lobbying practices that keep them in place as being bad—or to their local teams who are working on overdrive.

Rivian CEO on state-to-state dealership laws

In a report published on Thursday, Rivian CEO RJ Scaringe said that dealership franchise laws were “as close as you can get to corruption,” as stated during a discussion with InsideEVs about whether Rivian’s recent Volkswagen partnership could let the startup work through VW dealerships. The report has reignited long-held discussions about states where Tesla, Rivian, and others aren’t allowed to operate—and seemingly due to powerful lobbying from dealership groups.

“Unfortunately, in the United States, it’s not an easy question,” Scaringe said as to the proposition of selling through VW’s dealers. “We have this horrific state-by-state level of rules that are as close as you can get to corruption.

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“I think you essentially have, like, lots of dealers have paid for laws that make it really hard for us to interact directly with the consumer,” the Rivian CEO adds.

RELATED: Tesla granted license for direct vehicle sales in Kentucky

Tesla VP of Finance on state-to-state dealership laws

As a follow-up to the story, Tesla VP of Finance Sendil Palani shared his thoughts in a post on Saturday, praising the company’s local teams in states where direct sales are actively banned:

Tesla has been pursuing the direct-to-consumer model for two decades, and it has been an enormous challenge to pursue what we believe is the best model for customers.

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I spent a portion of this past week visiting our Northeast region, and was reminded about how these laws are among our most prominent challenge for Sales and Delivery. Local teams make a heroic effort across the entire customer journey: from allowing customers to learn about our product at non-licensed locations while observing restrictions on sales activities, to managing a large flow of deliveries through a small number of licensed locations, to ensuring that we can properly perform vehicle registration paperwork for multiple states and customer circumstances at each licensed location.

Our customers have to make heroic efforts of their own, from traveling long distances to pick up their vehicle to patiently enduring any kinks in the process.

Sadly, this is common throughout much of the country, resulting in higher costs and a worse customer experience for the affected regions.

U.S. states with bans on direct sales models like at Tesla, Rivian

  • Alabama (includes service centers)
  • Arkansas
  • Connecticut (leasing is allowed; tribal land loophole)
  • Iowa
  • Kansas (includes storefronts)
  • Kentucky
  • Louisiana (Tesla allowed through special license, “service center” model)
  • Nebraska
  • New Mexico (includes service centers; tribal land loophole)
  • Oklahoma
  • South Carolina (includes service centers)
  • Texas (Tesla sells through online loophole, “service center” model)
  • West Virginia (includes storefronts)
  • Wisconsin

U.S. states with store limits on direct sales models like at Tesla, Rivian

  • Illinois (limited to 13)
  • Maryland (limited to 4)
  • Mississippi (limited to 1)
  • New Jersey (limited to 4)
  • New York (limited to 5)
  • North Carolina (limited to 6)
  • Ohio (limited to 3)
  • Pennsylvania (limited to 5)
  • Virginia (limited to 5)

What are your thoughts? Did I miss anything, or do you have a story or opinion to share regarding direct auto sales? Let me know at zach@teslarati.com, find me on X at @zacharyvisconti, or send us tips at tips@teslarati.com.

DOJ echoes Tesla argument in Louisiana direct sales appeal
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Zach is a renewable energy reporter who has been covering electric vehicles since 2020. He grew up in Fremont, California, and he currently lives in Colorado. His work has appeared in the Chicago Tribune, KRON4 San Francisco, FOX31 Denver, InsideEVs, CleanTechnica, and many other publications. When he isn't covering Tesla or other EV companies, you can find him writing and performing music, drinking a good cup of coffee, or hanging out with his cats, Banks and Freddie. Reach out at zach@teslarati.com, find him on X at @zacharyvisconti, or send us tips at tips@teslarati.com.

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Tesla makes latest move to remove Model S and Model X from its lineup

Tesla’s latest decisive step toward phasing out its flagship sedan and SUV was quietly removing the Model S and Model X from its U.S. referral program earlier this week.

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Credit: Tesla

Tesla has made its latest move that indicates the Model S and Model X are being removed from the company’s lineup, an action that was confirmed by the company earlier this quarter, that the two flagship vehicles would no longer be produced.

Tesla has ultimately started phasing out the Model S and Model X in several ways, as it recently indicated it had sold out of a paint color for the two vehicles.

Now, the company is making even more moves that show its plans for the two vehicles are being eliminated slowly but surely.

Tesla’s latest decisive step toward phasing out its flagship sedan and SUV was quietly removing the Model S and Model X from its U.S. referral program earlier this week.

The change eliminates the $1,000 referral discount previously available to new buyers of these vehicles. Existing Tesla owners purchasing a new Model S or Model X will now only receive a halved loyalty discount of $500, down from $1,000.

The updates extend beyond the two flagship vehicles. New Cybertruck buyers using a referral code on Premium AWD or Cyberbeast configurations will no longer get $1,000 off. Instead, both referrer and buyer receive three months of Full Self-Driving (Supervised).

The loyalty discount for Cybertruck purchases, excluding the new Dual Motor AWD trim level, has also been cut to $500.

These adjustments apply only in the United States, and reflect Tesla’s broader strategy to optimize margins while boosting adoption of its autonomous driving software.

The timing is no coincidence. Tesla confirmed earlier this year that Model S and Model X production will end in the second quarter of 2026, roughly June, as the company reallocates factory capacity toward its Optimus humanoid robot and next-generation vehicles.

With annual sales of the low-volume flagships already declining (just 53,900 units in 2025), incentives are no longer needed to drive demand. Production is winding down, and Tesla expects strong remaining interest without subsidies.

Industry observers see this as the clearest sign yet of an “end-of-life” phase for the vehicles that once defined Tesla’s luxury segment. Community reactions on X range from nostalgia, “Rest in power S and X”, to frustration among long-time owners who feel perks are eroding just as the models approach discontinuation.

Some buyers are rushing orders to lock in final discounts before they vanish entirely.

Doug DeMuro names Tesla Model S the Most Important Car of the last 30 years

For Tesla, the move prioritizes efficiency: fewer discounts on outgoing models, a stronger push for FSD subscriptions, and a focus on high-margin Cybertruck trims amid surging orders.

Loyalists still have a narrow window to purchase a refreshed Plaid or Long Range model with remaining incentives, but the message is clear: Tesla’s lineup is evolving, and the era of the original flagships is drawing to a close. 

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Tesla Australia confirms six-seat Model Y L launch in 2026

Compared with the standard five-seat Model Y, the Model Y L features a longer body and extended wheelbase to accommodate an additional row of seating.

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Credit: Tesla China

Tesla has confirmed that the larger six-seat Model Y L will launch in Australia and New Zealand in 2026. 

The confirmation was shared by techAU through a media release from Tesla Australia and New Zealand.

The Model Y L expands the Model Y lineup by offering additional seating capacity for customers seeking a larger electric SUV. Compared with the standard five-seat Model Y, the Model Y L features a longer body and extended wheelbase to accommodate an additional row of seating.

The Model Y L is already being produced at Tesla’s Gigafactory Shanghai for the Chinese market, though the vehicle will be manufactured in right-hand-drive configuration for markets such as Australia and New Zealand.

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Tesla Australia and New Zealand confirmed the vehicle will feature seating for six passengers.

“As shown in pictures from its launch in China, Model Y L will have a new seating configuration providing room for 6 occupants,” Tesla Australia and New Zealand said in comments shared with techAU.

Instead of a traditional seven-seat arrangement, the Model Y L uses a 2-2-2 layout. The middle row features two individual seats, allowing easier access to the third row while providing additional space for passengers.

Tesla Australia and New Zealand also confirmed that the Model Y L will be covered by the company’s updated warranty structure beginning in 2026.

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“As with all new Tesla Vehicles from the start of 2026, the Model Y L will come with a 5-year unlimited km vehicle warranty and 8 years for the battery,” the company said.

The updated policy increases Tesla’s vehicle warranty from the previous four-year or 80,000-kilometer coverage.

Battery and drive unit warranties remain unchanged depending on the variant. Rear-wheel-drive models carry an eight-year or 160,000-kilometer warranty, while Long Range and Performance variants are covered for eight years or 192,000 kilometers.

Tesla has not yet announced official pricing or range figures for the Model Y L in Australia.

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Tesla Roadster patent hints at radical seat redesign ahead of reveal

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A newly published Tesla patent could offer one of the clearest signals yet that the long-awaited next-generation Roadster is nearly ready for its public debut.

Patent No. US 20260061898 A1, published on March 5, 2026, describes a “vehicle seat system” built around a single continuous composite frame – a dramatic departure from the dozens of metal brackets, recliner mechanisms, and rivets that make up a traditional car seat. Tesla is calling it a monolithic structure, with the seat portion, backrest, headrest, and bolsters all thermoformed as one unified piece.

The approach mirrors Tesla’s broader manufacturing philosophy. The same company that pioneered massive aluminum castings to eliminate hundreds of body components is now applying that logic to the cabin. Fewer parts means fewer potential failure points, less weight, and a cleaner assembly process overall.

Tesla Roadster Seat Concept Image by TESLARATI

Tesla ramps hiring for Roadster as latest unveiling approaches

The timing of the filing is difficult to ignore. Elon Musk has publicly targeted April 1, 2026 as the date for an “unforgettable” Roadster design reveal, and two new Roadster trademarks were filed just last month. A patent describing a seat architecture suited for a hypercar, and one that Tesla has promised will hit 60 mph in under two seconds.

The Roadster, originally unveiled in 2017, has been one of Tesla’s most anticipated yet most delayed products. With a target price around $200,000 and engineering ambitions to match, it is being positioned as the ultimate showcase for what Tesla’s technology can do.

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The patent was first flagged by @seti_park on X.

Tesla Roadster Monolithic Seat: Feature Highlights via US Patent 20260061898 A1

  1. Single Continuous Frame (Monolithic Construction). The core invention is a seat assembly built from one continuous frame that integrates the seat portion, backrest portion, and hinge into a single component — eliminating the need for separate structural parts and mechanical joints typical in conventional seats.
  2. Integrated Flexible Hinge. Rather than a traditional mechanical recliner, the hinge is built directly into the continuous frame and is designed to flex, and allowing the backrest to move relative to the seat portion. The hinge can be implemented as a fiber composite leaf spring or an assembly of rigid linkages.
  3. Thermoformed Anisotropic Composite Material. The continuous frame is manufactured via thermoforming from anisotropic composite materials, including fiberglass-nylon, fiberglass-polymer, nylon carbon composite, Kevlar-nylon, or Kevlar-polymer composites, enabling a molded-to-shape monolithic structure.
  4. Regionally Tuned Stiffness Zones. The frame is engineered with up to six distinct stiffness regions (R1–R6) across the seat, backrest, hinge, headrest, and bolsters. Each zone can have a different stiffness, allowing precise ergonomic and structural tuning without adding separate components.
  5. Linkage Assembly Hinge Mechanism. The hinge incorporates one or more linkage assemblies consisting of multiple interlocking links with gears, connected by rods. When driven by motors or actuators, these linkages act as a flexible member to control backrest movement along a precise, ergonomically optimized trajectory.
  6. Multi-Actuator Six-Degree-of-Freedom Positioning System. The seat uses four distinct actuator pairs, all controlled by a central controller. These actuators work in coordinated combinations to achieve fore/aft, height, cushion tilt, and backrest rotation adjustments simultaneously.
  7. ECU-Based Controller Architecture. An Electronic Control Unit (ECU) and programmable controller manage all seat actuators, receive user input via a user interface (touchscreen, buttons, or switches), and incorporate sensor feedback to confirm and maintain desired seat positions, essentially making this a software-driven seat system.
  8. Airbag-Integrated Bolster Deployment System. The backrest bolsters (216) are geometrically shaped and sized to guide airbag deployment along a specific, pre-configured trajectory. Left and right bolsters can have different shapes so that each guides its respective airbag along a distinct trajectory, improving occupant protection.
  9. Ventilation Holes Formed into the Backrest. The continuous frame includes one or more ventilation holes formed directly into the backrest portion, configured to either receive airflow into or deliver airflow from the seat frame — enabling passive or active thermal comfort without requiring separate ventilation components.
  10. Soft Trim Recess for Tool-Free Integration. The headrest and backrest portions together define a molded recess, specifically designed to receive and secure a soft trim component (foam, fabric, or cushioning) directly into the continuous frame, eliminating the need for separate attachment hardware and simplifying final assembly.

 

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