Rivian has filed a federal lawsuit in Ohio seeking to overturn the state’s ban on direct-to-consumer vehicle sales, calling the restriction an outdated barrier that protects incumbent dealers at the expense of consumers.
The California-based electric vehicle maker sued the registrar of Ohio’s Bureau of Motor Vehicles on Monday, alleging that the prohibition on its direct-sales business model “reduces competition, decreases consumer choice, and drives up consumer costs and inconvenience — all of which harm consumers — with literally no countervailing benefit.” Rivian currently sells vehicles directly in 25 states and Washington, D.C., but Ohio customers must order from out-of-state locations and have vehicles shipped to local service centers.
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The lawsuit targets a 2014 law that Rivian says was enacted after “an intense lobbying effort by the Ohio Automobile Dealers Association” and effectively granted Tesla Inc. a carve-out while blocking other automakers from obtaining dealership licenses.
“Consumer choice is a bedrock principle of America’s economy. Ohio’s archaic prohibition against the direct-sales of vehicles is unconstitutional, irrational, and harms Ohioans by reducing competition and choice and driving up costs and inconvenience,” said Mike Callahan, Rivian’s chief administrative officer.
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The case echoes other U.S. disputes over direct sales. Rivian and Lucid Motors won the right to sell directly in Illinois in 2021 despite legal opposition from local dealer groups. Lucid is currently appealing a Texas ruling that upheld that state’s sales ban.
