Tesla Takes on the Dealerships—and GM

“We need your help,” Tesla wrote in a Feb. 19 e-mail to its customers in Indiana. The state legislature was about to move forward with a bill that would have forced the electric-car maker to find a franchisee to operate its one showroom in the state, setting a precedent that would make it harder for Tesla to open others elsewhere. The company claimed the legislation reflected the interests and influence of one rival: General Motors. “Don’t let GM tell you that your only option is to buy a car from a traditional franchised dealer by shutting out Tesla,” the e-mail continued. Tesla asked recipients to contact their lawmakers.

The company’s rallying cry worked. On Feb. 25, the Indiana Senate committee considering the bill decided to drop the amendment that would have forced Tesla to adopt the dealership model. But the brawl in Indianapolis opened a new front in the cold war between Tesla, which leads the battery-powered-car market, and GM, which plans to introduce its electric Chevy Bolt late this year. Tesla is also preparing its first mass-market car, the Model 3, expected in late 2017. Both vehicles will go more than 200 miles on a single charge, and both are slated to cost less than $40,000 before government incentives—dramatically expanding the market of potential buyers.