Could this case set a precedent for direct manufacturer-to-customer dealerships?

lucid motors sues texas over dealership rights
PATRICK T. FALLONGetty Images

  • Lucid Motors is fighting back against Direct-Sales Prohibition laws state-by-state, most recently in a federal lawsuit filed in Texas.
  • Due to Texas state legislation, the California-based EV company is unable to open its own dealership or sell new models directly to customers, a rule that Lucid believes is unconstitutional.
  • Tesla has faced similar legal scrutiny in its quest for independent sales and service networks, eventually selling to customers through legal loopholes in the state of Michigan, but Lucid’s suit is set to question the legality of the rules as a whole.

    Lucid Motors set out to be a disruptor from its inception, but the company’s reality hasn’t exactly aligned with its vision. Production woes and high prices have been balanced by lap records and market-leading EV range, leaving the company in a culturally well-known but financially uncertain position. Getting cars to customers has proven to be the company’s biggest challenge, but production problems aren’t entirely to blame. Due to Lucid’s unique in-house manufacturing, sales, and service network, some states have taken issue with its desire to sell directly to customers and want to force Lucid to sell through established dealer networks.

    Lucid has fought back against these regulations, however, with its most recent filing last week in federal court in Texas. Filed against Monique Johnston, Daniel Avita, and Corrie Thompson—all Texas Department of Motor Vehicles officials—Lucid claims the state’s refusal to allow the company to obtain a dealership license is anti-competitive and hurts consumer choice in the state of Texas. Additionally, Lucid claims Texas’ prohibitive legislation actually encourages out-of-state transactions, which will funnel revenue away from the state and lead customers to be uncovered by in-state consumer protections.

    lucid motors sues texas over dealership rights

    The futuristic looking Lucid Air is the company’s only offering, with prices ranging from $87,400 for the incoming Air Pure to $179,000 for Grand Touring Performance models.

    Lucid

    For context, Texas laws protect traditional dealership networks by requiring automotive manufacturers to sell through these networks, but this also means manufacturers without independent dealers are prohibited from operating their own dealerships. The law goes as far as to say Lucid can legally rent or lease its cars to Texans in-state, sell pre-owned Lucids in-state, and even sell brand new models to Texans buying out-of-state, but it cannot sell a new Lucid or open its own dealership in Texas.

    “This prohibition is pure economic protectionism for the benefit of Texas’ existing auto dealers,” Lucid lawyers wrote in a pointed court briefing. “It puts their profits ahead of the interests of Texas consumers.”

    lucid motors sues texas over dealership rights

    Lucid’s Chief Technology Officer Peter Rawlinson shown here at the launch of the Air in 2016.

    MediaNews Group/Bay Area News via Getty ImagesGetty Images

    Lucid maintains the state of Texas has no legitimate reason for blocking its citizens from buying Lucids directly, even calling Texas’ laws unconstitutional. And Lucid may have a point, given the outcome of a similar suit between Tesla and the state of Michigan.

    After four years of litigation, Tesla and Michigan settled a similar case in 2020, ultimately allowing any Michigan resident to lawfully buy a Tesla and have it serviced in Michigan. The caveat, in this case, is that Tesla does not have a dealer license in Michigan, meaning it sells cars to consumers through legal loopholes like using out-of-state registrations. Meanwhile, at Tesla’s home base in Texas, the company faces the same dealer challenges as Lucid.

    Lucid’s case against Texas could set the precedent for independent dealerships in the future. Citing independent dealer-supportive Federal Trade Commission language, Lucid thinks it has a strong case, one that could lead to diminished protections for the traditional dealership network. For now, manufacturers will have to wait for the outcome of what’s set to be a lengthy legal battle, as manufacturers and dealership networks grapple with limited supplies and increasing demand.

    Emmet White A New York transplant hailing from the Pacific Northwest, Emmet White has a passion for anything that goes: cars, bicycles, planes, and motorcycles.

    Keyword: Lucid Motors Sues Texas Over Dealership Rights

    CAR'S NEWS RELATED

    The 2025 Lucid Gravity Is A 440-Mile, Seven-Seat Electric SUV 'Powerhouse'

    The Lucid Gravity aims to redefine luxury electric SUVs. Can it move the needle for this EV startup?

    View more: The 2025 Lucid Gravity Is A 440-Mile, Seven-Seat Electric SUV 'Powerhouse'

    Possible Lucid Pickup Truck Seen In Clay Model Form

    It could be a design study. It could be a future model. Either way, we sort of want one.

    View more: Possible Lucid Pickup Truck Seen In Clay Model Form

    Lucid Burned $433,000 For Every Car It Sold In Q3, Reports $2.17 Billion In Losses So Far This Year

    Image: Lucid California-based automaker Lucid reported third quarter results on Tuesday, and the numbers aren’t great. The company announced that it built 1,550 Air sedans in Q3, and delivered 1,456 to customers. Each of those cars delivered accounted for $433,000 worth of red ink on the company’s balance sheets, ...

    View more: Lucid Burned $433,000 For Every Car It Sold In Q3, Reports $2.17 Billion In Losses So Far This Year

    A Lucid Air Can Now Directly Charge Other EVs

    The Lucid Air's newest OTA update will let the electric sedan charge most other EVs just by connecting a new cable to its charge port.

    View more: A Lucid Air Can Now Directly Charge Other EVs

    Lucid Motors (LCID) introduces RangeXchange, offering vehicle-to-vehicle charging capabilities

    Lucid Motors has introduced a new feature it calls “RangeXchange” which enables vehicle-to-vehicle (V2V) charging, meaning current and future Lucid owners can recharge other EVs using their battery’s stored energy… as long as you buy the adapter cable. It’s been a busy few months for Lucid Motors ($LCID) – ...

    View more: Lucid Motors (LCID) introduces RangeXchange, offering vehicle-to-vehicle charging capabilities

    Lucid Lost $430,000 For Every Car It Sold In Q3

    The American luxury EV maker cut its production guidance for this year after a weak quarter.

    View more: Lucid Lost $430,000 For Every Car It Sold In Q3

    Lucid (LCID) cuts 2023 EV production target as operating losses widen in Q3

    Lucid Motors (LCID) is cutting its 2023 production goal following widening losses in Q3. The EV maker is facing stiff competition in the premium electric vehicle market. Despite initial plans to build between 10,000 and 14,000 cars this year, Lucid is revising its plans as EV sales fail to ...

    View more: Lucid (LCID) cuts 2023 EV production target as operating losses widen in Q3

    Lucid cuts full-year production forecast

    Companies Lucid Group Inc Nov 7 (Reuters) – Lucid Group (LCID.O) said on Tuesday it now expects to produce 8,000–8,500 vehicles this year from its earlier projection of more than 10,000 units. The company said it was cutting production forecast “to prudently align with deliveries”. Shares of the company ...

    View more: Lucid cuts full-year production forecast

    Lucid Confirms NACS Plug In 2025 As Future Of US High-Voltage Charging Seems Settled

    Get A Closer Look At Some Of The Lucid Gravity SUV's Details

    Lucid Motors joins the ‘in crowd,’ will adopt NACS and offer access to Tesla’s Supercharger network

    Lucid cuts prices of electric sedans for limited time amid EV price wars

    Lucid To Add Native Apple And Amazon Music Support In Its Cars

    Lucid job post hints at addition of Apple and Amazon Music to its EVs, more media apps to follow?

    The 1,234-HP Lucid Air Sapphire Almost Made Me Barf, It Ruled

    Hyundai follows Lucid partnering with Saudi’s PIF to build a new manufacturing plant

    Lucid Motors turns to a new demand lever: An owner referral program

    We’ll Finally See The Lucid Gravity SUV In November

    Lucid Air Deliveries Still Below 1,500 In Q3 2023

    Lucid Air production plummeted in Q3

    OTHER CAR NEWS

    ; Top List in the World https://www.pinterest.com/newstopcar/pins/
    Top Best Sushi Restaurants in SeoulTop Best Caribbean HoneymoonsTop Most Beautiful Islands in PeruTop Best Outdoor Grill BrandsTop Best Global Seafood RestaurantsTop Foods to Boost Your Immune SystemTop Best Foods to Fight HemorrhoidsTop Foods That Pack More Potassium Than a BananaTop Best Healthy Foods to Gain Weight FastTop Best Cosmetic Brands in the U.STop Best Destinations for Food Lovers in EuropeTop Best Foods High in Vitamin ATop Best Foods to Lower Your Blood SugarTop Best Things to Do in LouisianaTop Best Cities to Visit in New YorkTop Best Makeup Addresses In PennsylvaniaTop Reasons to Visit NorwayTop Most Beautiful Islands In The WorldTop Best Law Universities in the WorldTop Richest Sportsmen In The WorldTop Biggest Aquariums In The WorldTop Best Peruvian Restaurants In MiamiTop Best Road Trips From MiamiTop Best Places to Visit in MarylandTop Best Places to Visit in North CarolinaTop Best Electric Cars For KidsTop Best Swedish Brands in The USTop Best Skincare Brands in AmericaTop Best American Lipstick BrandsTop Michelin-starred Restaurants in MiamiTop Best Secluded Getaways From MiamiTop Best Things To Do On A Rainy Day In MiamiTop Most Instagrammable Places In MiamiTop Interesting Facts about FlorenceTop Facts About The First Roman Emperor - AugustusTop Best Japanese FoodsTop Most Beautiful Historical Sites in IsraelTop Best Places To Visit In Holy SeeTop Best Hawaiian IslandsTop Reasons to Visit PortugalTop Best Hotels In L.A. With Free Wi-FiTop Best Scenic Drives in MiamiTop Best Vegan Restaurants in BerlinTop Most Interesting Attractions In WalesTop Health Benefits of a Vegan DietTop Best Thai Restaurant in Las VegasTop Most Beautiful Forests in SwitzerlandTop Best Global Universities in GermanyTop Most Beautiful Lakes in GuyanaTop Best Things To Do in IdahoTop Things to Know Before Traveling to North MacedoniaTop Best German Sunglasses BrandsTop Highest Mountains In FranceTop Biggest Hydroelectric Plants in AmericaTop Best Spa Hotels in NYCTop The World's Scariest BridgeTop Largest Hotels In AmericaTop Most Famous Festivals in JordanTop Best European Restaurants in MunichTop Best Japanese Hiking Boot BrandsTop Best Universities in PolandTop Best Tips for Surfing the Web Safely and AnonymouslyTop Most Valuable Football Clubs in EuropeTop Highest Mountains In ColombiaTop Real-Life Characters of Texas RisingTop Best Beaches in GuatelamaTop Things About DR Congo You Should KnowTop Best Korean Reality & Variety ShowsTop Best RockstarsTop Most Beautiful Waterfalls in GermanyTop Best Fountain Pen Ink BrandsTop Best European Restaurants in ChicagoTop Best Fighter Jets in the WorldTop Best Three-Wheel MotorcyclesTop Most Beautiful Lakes in ManitobaTop Best Dive Sites in VenezuelaTop Best Websites For Art StudentsTop Best Japanese Instant Noodle BrandsTop Best Comedy Manhwa (Webtoons)Top Best Japanese Sunglasses BrandsTop Most Expensive Air Jordan SneakersTop Health Benefits of CucumberTop Famous Universities in SwedenTop Most Popular Films Starring Jo Jung-sukTop Interesting Facts about CougarsTop Best Hospitals for Hip Replacement in the USATop Most Expensive DefendersTop Health Benefits of GooseberriesTop Health Benefits of ParsnipsTop Best Foods and Drinks in LondonTop Health Benefits of Rosehip TeaTop Best Air Fryers for Low-fat CookingTop Most Asked Teacher Interview Questions with AnswersTop Best Shopping Malls in ZurichTop The Most Beautiful Botanical Gardens In L.A.Top Best Mexican Restaurants in Miami for Carb-loading rightTop Best Energy Companies in GermanyTop Best Garage HeatersTop Largest Banks in IrelandTop Leading Provider - Audit and Assurance In The USTop Best Jewelry Brands in IndiaTop Prettiest Streets in the UKTop Best Lakes to Visit in TunisiaTop Highest Mountains in Israel