A new study commissioned by the Connecticut Automotive Retailers Association says that legislation that would not require electric vehicle manufacturers to operate sales showrooms here would have a net negative impact on the state’s economy and cost thousands of jobs.
“The Economic Impact of Connecticut’s Auto Dealer Network,” produced by the Connecticut Center for Economic Analysis (CCEA) at the University of Connecticut, focuses on Senate Bill 127, currently under consideration. That bill would allow direct EV sales to customers without requiring a physical dealership in the state, something that CARA has long opposed.
According to the study, if passed, the bill would allow established automakers looking to move into or increase EV production to also avoid having to operate physical dealerships in Connecticut.
The result would “establish an uneven playing field now and unnecessarily increase mid-term risks to Connecticut dealers and the State’s economy,” the report said. “It clouds dealers’ and their employees’ futures while threatening sales and vehicle service levels that Connecticut customers legitimately expect.”
Due to the competitive advantages the bill gives external EV manufacturers, it continued, the CCEA “anticipates a plausible annual decline of 0.27% until 2035, when Volvo and the big three auto companies are manufacturing exclusively EVs and are thus positioned to terminate dealer contracts as manufactures of only EVs.
“Sales operations at all dealerships are displaced by the end of 2040,” it continued. “The constant annual rate of decline in retail margins from 2036 onward is asymptotic to zero in 2041.”
As a result, the CCEA estimates that by 2040, as many as 40,239 jobs; $3.9 billion in economic activity; personal income of $1.1 billion; and state revenue of $431 would all be threatened.
“Bill 127 undermines reinvigoration of Connecticut’s economy and ought not to pass,” the report declared.
CARA continues to say that it supports EV sales within the state, but under the current model. “Our industry strongly supports promoting and enhancing the electric vehicle market in Connecticut,” according to its website. “There are currently over 40 EVs on the market today, and many of these may be found at local dealerships in Connecticut.”
EV manufacturers like Tesla and Rivian have continued to insist that physical dealerships should not be a requirement to sell their vehicles.
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