Iowa DOT Engages Regarding Tesla

As part of my ongoing beratement of the seemingly clueless bureaucrats and politicians in Iowa involved in the cancellation of part of the September test drives conducted by Tesla Motors, I recently emailed Paul Steier, the Director of Iowa’s Bureau of Investigation & Identity Protection, part of the state’s Department of Transportation.

Below is my email thread with the Iowa DOT (I apologize for the length of this post, but I wanted to include each volley out of respect to the Iowa DOT, Paul Steier, and Mark Lowe).


Dear Mr. Steier:

Because you’re mentioned in the following blog post, Tesla Bigot: IADA’s Bruce Anderson, I wanted to share it with you. Although I don’t mention you in other blog posts regarding the issue of the legitimacy and legality of Tesla test drives and sales in Iowa and Michigan, you may be interested.

This issue isn’t going to simply disappear. Consumers deserve options and Tesla deserves to sell in the state of Iowa (and offer test drives). Allowing foreign companies like Toyota, Kia, and Range Rover to conduct test drives and sales, but not a company like Tesla that employs 6,000 hard working Americans, is really short-sighted. Citing existing laws is endorsing stupidity. You folks are establishing a legacy for yourselves—and future generations won’t view it in a positive light.

Regards,

Curt Robbins


In response, I received the following email from Mark Lowe, Director of the Motor Vehicle Division at the Iowa Dept. of Transportation [I apologize for the lack of paragraph breaks]:

Dear Mr. Robbins,

Paul Steier, Director of our Bureau of Investigation & Identity Protection, shared with me your recent blog regarding cancellation of the Tesla sales event in Iowa.  Although you have every right to debate the merits of Iowa’s motor vehicle sales and dealership laws, I feel compelled to defend Mr. Steier against your suggestion that he lacks intelligence or ethics.  Mr. Steier is a highly intelligent, ethical person who provides valuable service to Iowa citizens every day by helping to model s and solar panelsprotect them against identity, vehicle, and other consumer frauds.  In this instance, Mr. Steier was interpreting Iowa law exactly as it was and is currently written — Chapter 322 explicitly prohibits engaging in the business of selling vehicles without a dealer’s license, and section 322.2(7) of the Iowa Code defines being “engaged in the business” as “doing any of the following acts for the purpose of the sale of motor vehicles at retail: acquiring, selling, exchanging, holding, offering, displaying, brokering, accepting on consignment, conducting a retail auction, or acting as an agent for the purpose of doing any of those acts.”  In this instance, Tesla was clearly engaged in the business of selling motor vehicles  — in addition to displaying vehicles by offering test drives for the purpose of inducing sales, Tesla representatives were encouraging and helping customers to complete actual sales transactions.  In addition, section 322.2(14) specifically prohibits a manufacturer from acting as a dealer in Iowa.  When contacted during the event, neither the Tesla representatives at the event nor Tesla’s counsel disagreed that Tesla was engaged in the business of selling motor vehicles without a required dealer’s license in contravention of Iowa law.  The provisions of Chapter 322 that prohibit engaging in the business of selling motor vehicles without a dealer’s license are mandatory and may not be waived by the Iowa Department of Transportation, and Mr. Steier is obligated to explain and enforce the law as it is currently written.  Thank you.

Mark Lowe
Director, Motor Vehicle Division
Iowa Dept. of Transportation


Unlike Iowa Senator Matt McCoy and Rep. Peter Cownie, Mr. Lowe has actively engaged me in constructive dialog regarding the cancellation of the September test drives conducted by Tesla Motors.

Below is my response to Mr. Lowe:

Dear Mr. Lowe,

I appreciate you taking the time to respond to my email to Mr. Steier and my blog post regarding the cancellation of Tesla’s test drives in West Des Moines in September.

Apparently it is Iowa’s antiquated laws that are hurting consumers and unfairly penalizing Tesla Motors, not Mr. Steier’s actions. However, I respectfully argue the issue of whether Tesla was “selling” vehicles at the test drive event. If Iowa’s law is so backward and poorly phrased that it illogically defines “displaying” as sales, then I suppose you have me—and thousands of Iowa citizens who desire to learn more about Tesla’s vehicles—on a technicality.

Thus, I’ll cease picking on Mr. Steier and instead pester you and Governor Branstad. When will Iowa’s leadership do the right thing for its citizens, economy, and environment and change its archaic laws, allowing tax-paying voters to do something as simple as test drive a 21st century all-electric vehicle?

Regards,

Curt Robbins


In response, Mr. Lowe sent the following:

mark lowe iowa DOTI think there are several things to consider. One is that the purpose of displaying an auto is of course to encourage and facilitate its sale, but beyond that, and probably more importantly, the law has tried to protect consumers by helping them know who they are dealing with and where to seek recourse should something go wrong, either with the mechanics and operation of the vehicle itself or the clear title to the vehicle.  Vehicles, particularly in a rural state like Iowa with fewer public transportation options, are a major investment for most citizens and a key to personal and professional mobility — obtaining a vehicle that is not fit for operation of that cannot be registered can be a major disruption personal and professional disruption for most people [sic].  Much of what is in Chapter 322 is designed to protect citizens against someone blowing into town, unloading mechanically unfit vehicles and/or vehicles that cannot be titled clearly, and then vanishing into the night.  This is not to suggest that Tesla was doing that, but only to say that broadly defining sales, requiring persons selling vehicles to have a license and requiring them to declare their places of operation has helped protect consumers from unscrupulous sellers. (Consider, for a moment, the prospect that someone wholly unassociated with Tesla could obtain a hotel conference room, display a Tesla vehicle from the hotel room and offer test drives to perspective customers, and then induce down payments for orders never go be delivered on [sic]. These are the kinds of activity our dealer laws have long sought to protect people from.)

None of this is to say that laws long in place cannot be reviewed to determine whether they are keeping pace with current markets and means of doing business, but is only to say that there are important consumer protection issues that should not be overlooked in the review.

Best regards,

Mark Lowe
Director, Motor Vehicle Division
Iowa Dept. of Transportation


My response:

Dear Mr. Lowe:

I appreciate your quick response and attention to this issue. I agree wholeheartedly that consumer protection is of paramount concern. You and every one of the appointed or elected officials with any influence whatsoever over issues concerned consumers in the state of Iowa should take this issue seriously. I’m glad to see that you do.

I agree that Iowa—and every state in the U.S.—should have laws that, as you state, “protect citizens against someone blowing into town, unloading mechanically unfit vehicles and/or vehicles that cannot be titled clearly, and then vanishing into the night.” Bravo (none of my trademark cheeky cynicism implied). This is exactly what government and persons such as yourself and Peter Steier should be working to achieve and maintain.

However, your next statement reads, “This is not to suggest that Tesla was doing that, but only to say that broadly defining sales, requiring persons selling vehicles to have a license and requiring them to declare their places of operation has helped protect consumers from unscrupulous sellers.” I would agree. But do you, Mr. Steier, or anyone else at the DOT perceive Tesla Motors to be an “unscrupulous seller”? This award-winning and revered company has sold tens of thousands of its vehicles around the world. From what I’ve learned in my research, most of Tesla’s customers are not only satisfied, but many are evangelists or zealots.

However, I take issue with your statement that, during the test drives, “Tesla was clearly engaged in the business of selling [my emphasis] motor vehicles.” I noted your opening volley: “…your recent blog regarding cancellation of the Tesla sales event [my emphasis] in Iowa.” You label the test drives a “sales event.” But no vehicles were sold. Not only that, but Tesla didn’t attempt to sell vehicles. I recognize, understand, and respect your role and duty in protecting the consumers of Iowa, Mr. Lowe (such protection is part of what makes America one of the greatest nations on earth). Truly.

But to label Tesla’s West Des Moines test drives a “sales event” flies in the face of logic and reality. Simply because Iowa’s old school laws define such an event as “sales” doesn’t necessarily make it so. Why would one of the world’s most innovative and intelligent companies purposefully sell vehicles in violation of Iowa’s laws? Should we suppose that Tesla employs no corporate attorneys or never consults them prior to promotional activities in conservative states like Iowa?

Closing on a positive note: Thank you for your engagement on this issue. Bruce Anderson, president of the Iowa Automobile Dealers Association, as well as Senator Matt McCoy and Rep. Peter Cownie, haven’t responded to my numerous attempts to engage them in a constructive dialog regarding the rationale behind the cancellation of the September Model S test drives. I understand Mr. Anderson’s refusal to respond: He’s the hired gun of Iowa’s auto dealers and clearly a special interest. I’m disappointed, however, that Senator McCoy and Rep. Cownie remain silent (although I understand that, as a citizen of Ohio, I am owed nothing by them). Mr. Anderson owes nothing to the people of Iowa. Senator McCoy and Rep. Cownie, however, are beholden to their constituents and the voters who elected them to office.

Regards,

Curt Robbins


Bravo. Really.

It seems Mr. Lowe is the only one with the integrity to actually engage me in a dialog to, hopefully, push Iowa’s laws into the 21st century and better serve its citizens. While the protection of Iowa’s consumers is critical, the penalization of those same consumers (who might desire to test drive or purchase an electric vehicle) is both harmful and highly ironic.

I applaud Mr. Lowe for taking the time from his day to engage with me and describe the rationale behind the decisions of Paul Steier and the Iowa DOT.

Hopefully this is the beginning of a constructive dialog that will eventually result in the revision of consumer protection laws in the state of Iowa and the advancement of the state’s transportation infrastructure.

Are you paying attention, Michigan?

curtsig2 - trans
Curt Robbins


Curt Robbins is author of the following books from Amazon Kindle:

You can follow him on Twitter at @CurtRobbins, read his AV-related blog posts at rAVe Publications, and view his photos on Flickr.

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Tesla Test Drives: Responding to Bob

My blog post entitled Tesla Bigot: IADA’s Bruce Anderson from October 4 is gaining a bit of traction and has actually garnished some feedback (always exciting for new bloggers like myself). Below is a comment received from this post and my response.model s and solar panels

I also sent a Tweet to Anderson (@IADA_Bruce), the president of the Iowa Auto Dealers Association, asking him for a public dialog allowing us to debate the validity of his successful effort to cancel Tesla’s test drives in early September. In addition, I copied Senator Matt McCoy (@mccoyforsenate) and Rep. Peter Cownie (@petercownie) in an attempt to involve these Iowa politicians in the dialog.

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Curt Robbins


bob
Submitted on 2014/10/06 at 5:59 pm

So according to this decisions all expo, conference & trade shows should now follow this decisions and not be allowed. Be careful what you wish for.

curtrobbins
Submitted on 2014/10/06 at 6:05 pm | In reply to bob.

Hi Bob,

I’m confused. Can you elaborate? I honestly don’t understand exactly what you’re getting at. I enjoy—and seek out—an intelligent and honest dialog regarding any consumer tech topic. But can you clarify your comment?

In terms of being careful about what I wish for: I wish simply that a disruptive, game-changing company like Tesla would be permitted to at least demonstrate its technology first-hand. It’s sad enough that this company can’t actually sell in the state of Iowa due to…I know, I’ve said it so many times before…antiquated laws from a bygone era. Those laws served 1950s-80s America really well. But no more. (Technical clarification: Anyone, in any state, can purchase Tesla’s vehicles from its website.)

tesla model s replacement for blogPlease note that I’m not suggesting Buick, Ford, or Hyundai be prohibited from conducting test drives. I believe healthy, fair competition is what has made America great. But to prohibit an American company as promising as Tesla from simply demonstrating its product to prospective customers is really Neanderthal thinking. I want the voters of Iowa—and any state in this great union—to be able to test drive, purchase, sell, and service vehicles involving a wide variety of technologies from a multitude of companies.

Politicians like to cite patriotism. Ok. How patriotic is to allow Toyota (Japanese), Kia (Korean), and Range Rover (Indian) to conduct test drives on American soil, while prohibiting Silicon Valley-based Tesla from not only selling cars, but even test driving them? Tesla employs 6,000 hard-working Americans, and is expanding rapidly. I’m not suggesting Tesla deserves any special treatment. However, for American politicians to state that they are pro-American companies and pro-economic growth and then oppose—at any level: municipal, state, or federal—an American company embracing these very principles is, well, both illogical and hypocritical. Not to mention short-sighted.

I wouldn’t vote for them. Would you?

Now, back to your point of me being careful what I wish for. I wish that every one of my fellow Americans could understand, test, and have the ability to purchase any reasonably safe personal transportation vehicle on the market. Especially if it comes from an American company. No sane politician would disagree with me so far.

I’ll do my best to help people understand electric car technology and their product options (that’s what I do for a living). But if consumers know what they want and can’t even get it, how well are any of us serving them?


Curt Robbins is author of the following books from Amazon Kindle:

You can follow him on Twitter at @CurtRobbins, read his AV-related blog posts at rAVe Publications, and view his photos on Flickr.

Tesla Bigot: IADA’s Bruce Anderson

Bruce Anderson, president of the Iowa Automobile Dealers Association (IADA), recently forced the shutdown of a planned day of Model S test drives being offered by Tesla Motors in Des Moines. I’ve written before about Tesla and how auto dealerships—and their political allies—oppose the all-electric car manufacturer’s direct-to-consumer sales model.

But what car dealers, dealership trade groups, and self-serving Luddites like Anderson really oppose isn’t a particular sales model or how Tesla works with its customers. Rather, they fear fair competition. Compared to Tesla’s next-gen vehicles, their products suck. And they know it.

IADA Bruce Anderson - RESIZEAs reported in the Des Moines Register on September 25, “The Iowa Department of Transportation asked Tesla to stop its West Des Moines test drives after being alerted to the event by the [IADA].” One local resident, who had scheduled a test drive on the final day that was cancelled, lamented, “I hope they get [the laws] changed, because it’s just ridiculous.” Of course, are any of us really surprised that Iowa’s car dealers—in the form of Anderson—went crying to mommy because of a little competition?

And the logic behind the shutdown? In Iowa, “state law requires auto dealers to be licensed, and by offering test drives, Tesla was acting as a dealer,” wrote the Register. And who drew this conclusion? Paul Steier, Director of the Department of Transportation’s Bureau of Investigation and Identity Protection. More proof of the lack of intelligence and spirit of fair play in both government and old boy networks like car dealer associations.

To add insult to injury, Iowa lawmakers have little interest in changing the archaic laws currently prohibiting Tesla from conducting something as simple as a test drive of one of its efficient, zero emission cars. The blatant kowtowing of Iowa politicians to big business flies in the face of the desires of Iowa consumers.

Iowa Senator Matt McCoy, chairman of the Senate Commerce Committee, is, ironically, a fan of Tesla’s cars, having test driven a Model S (in another state, natch) and publicly stated that he plans to purchase the less-expensive Model 3 after its release in 2017. However, McCoy is about as clueless and lacking in foresight as Anderson. “I have mixed feelings about it because I really like the car and I really like what the car stands for,” he said. “But in Iowa, we tend to respect our system and the way it was set up, and I don’t see any appetite to change that.”

Apparently McCoy’s “mixed feelings” are caused by his affinity for the Model S paired with his desire for corporate campaign contributions. By the Senator’s logic, his state would never have evolved beyond horse and buggy, because the Iowa Buggy Dealers Association would have called on its political friends and bureaucratic allies to block sales of the Model T—rationalized by antiquated laws passed before automobiles even came into existence.

Even West Des Moines State Rep. Peter Cownie, chairman of the House Commerce Committee, is in on the game. “You can’t have two sets of rules. That would create an unfair playing field for the small business owners and small car dealers,” he said. By Cownie’s logic, don’t the outdated laws preventing Tesla from offering simple test drives unfairly limit it from doing business and marketing itself in the state of Iowa? Tesla is, after all, a “small business” compared to Ford, Toyota, and GM (each of which, individually, produces more vehicles per day than Tesla has since its inception in 2003).

More important, aren’t these politicians, who were elected to serve their constituents, unfairly limiting the car buying options of those who voted them into office (many of whom have proven they wish to test drive and purchase all-electric cars, like those offered by Tesla)?

According to Anderson (a former attorney), auto dealership licensing “is a matter of consumer protection.” “You can’t just set up in a hotel parking lot and sell cars,” he said. Anderson denies targeting Tesla, saying “it’s not a Tesla issue. This is a regulated industry.” Meaning that it’s not only Anderson and dealerships that are the problem, but also state and federal politicians and bureaucrats. Do Anderson and the dealerships he represents really consider denying residents of their state the opportunity to test drive—let alone purchase—an all-electric vehicle to be “protecting” them?

model s and solar panelsCar dealers nationwide have been freaking out over Tesla’s entry into the crowded auto market. And for good reason. Tesla makes and sells sexy cars that are nearly silent, fast as a Porsche, and do zero damage to the local environment. But what really begins to sway consumers: Tesla’s all-electric vehicles are far cheaper to operate and maintain than their gas-guzzling siblings from Detroit and Tokyo. In comparison, the products from every other automaker—with the exception of Nissan’s all-electric Leaf—are more expensive to operate, damaging to human health, and contribute to climate change. (You can’t commit a Hollywood-style suicide in a Tesla with an open window in a closed garage.)

Because Tesla’s models are currently too expensive for the average joe, call the recent dealership shenanigans a pre-emptive strike. But pre-emptive or not, dealerships, their political allies, and shortsighted dopes like Anderson and his cronies are pulling out all the stops in their desperate efforts to stop Tesla in its tracks. Fortunately, Iowans can purchase Tesla vehicles online—like the rest of the country (helpful for residents of Arizona, New Jersey, Maryland, Texas, and Virginia, where sales of Tesla vehicles are either banned or restricted).

If you think auto dealers are panicking now, wait until Tesla introduces its much-anticipated Model 3 in about three years. Slated to start at roughly $35K, the “everyman’s Tesla” will bring the fight between old-school car dealers and Tesla’s superior alternative to a head. Both dealership owners and auto manufacturers will be frantically spinning their 1988 Rolodexes to reach out to any politician owing them a favor.

But fear not, tree huggers and lovers of future-tech. Tesla will probably get the last laugh. Legacy Luddites like Anderson, Steier, Cownie, and McCoy are a dying breed. Their protectionist attitudes and policies, sustained at the expense of their fellow state citizens, will soon lie in the dinosaur boneyard, just like those 12 mile-per-gallon Hummers that are no longer for sale.

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Curt Robbins

[Also see my response to blog post commenter “bob” and my original Time for Tesla post. If you agree with any of the above, send Bruce Anderson a Tweet at @IADA_Bruce and let him know your feelings.]


Curt Robbins is author of the following books from Amazon Kindle:

You can follow him on Twitter at @CurtRobbins, read his AV-related blog posts at rAVe Publications, and view his photos on Flickr.