Tuesday, March 21Welcome

Lucid wins direct sales lawsuit against Illinois auto dealer

Lucid and Rivian win a lawsuit filed by an Illinois auto dealer over its direct-to-customer sales model. Following the contested example set by Tesla, both manufacturers have online platforms that allow buyers to buy cars without stepping into a sales-focused dealership or service depot. Lucid operates its own studio his network, allowing buyers to familiarize themselves with its products.

Images showing the interior of Lucid's flagship Beverly Hills Studio, with examples of motors and batteries in cars.
Lucid’s Beverly Hills Studio showcases examples of Air’s motors, batteries, interior textiles and paint colors.

IADA case
The lawsuit revolved around the direct-to-consumer sales model adopted by EV manufacturers. Dealer associations oppose these models because they eliminate middlemen (dealers) in the car purchase transaction and reduce revenues for association members. Tesla is one of the main proponents of this model and, as a leader in the luxury market, takes a lot of revenue away from dealers as a result. Lucid, Rivian and, in the future, other manufacturers such as Fisker and VinFast see this as a way to eliminate hold-ups and streamline the purchasing process for both sellers and buyers.

An image showing a partially assembled Rivian R1S on a production line at a factory in Normal, Illinois.
Rivian builds its vehicles at its own factory in Normal, Illinois.

Tesla often faced opposition from dealers over its direct selling model, and had to resort to a “hook or crook” mentality to circumvent the ban on manufacturers double-serving as dealers. Methods of doing this included having the buyer place an order in states where such a ban does not exist before shipping the vehicle to their home address.

Deputy Judge David Atkins ruled on December 19 that, contrary to IADA’s wishes, Illinois is fully justified in granting dealer licenses to Lucid and Rivian in 2021, and direct-to-consumer sales will begin in 2021. decided to allow the continuation of state. IADA is reportedly considering an appeal and issued the following statement to Automotive News:

“Unfortunately, after more than a year of considering the various motions of all the parties and acknowledging that the issue had gone unnoticed less than a week ago (mid-December), the judge decided not to offer an opportunity. I have issued an order dismissing the case without notice for oral argument.”

Lucid and Rivian’s sales model is legal in Illinois for the time being, and Judge Atkins said the state’s refusal to outlaw such practices allows automakers to continue to cut out middlemen. stated that he intended to

Images by Lucid Motors and Rivian licensed under CC BY 4.0.

James Walker is an automotive journalist for Torque News, focusing on Lucid Motors. He’s curious if it has wheels and is excited to see what kind of cars the EV revolution will bring. Fast or slow, new or old, James wants to look around and share in print and video.You can connect with James twitterInstagram, and LinkedIn.

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