Ohio Lets Tesla Sell Cars Direct—Rivian Wants the Same originally appeared on Autoblog.
Automaker Claims Franchise Law Harms Consumers
When Tesla bypassed traditional franchised dealerships over a decade ago and started selling its electric vehicles directly to customers it started a legal battle with the car-dealer lobby that continues to this day. This time it's Rivian's turn to skirmish.
On Monday, Rivian filed a lawsuit against the registrar of Ohio's Bureau of Motor Vehicles (BMV) in federal court in order to be able to sell its EVs directly to consumers in that state. The lawsuit argues that the Ohio BMV is harming consumers by blocking direct sales, according to TechCrunch.
Like Tesla, Rivian has been selling cars directly to its customers from the beginning. It's never used franchised dealerships, so it is not competing against its own franchisees, which is the argument behind franchise laws that prevent established automakers from engaging in direct sales. Rivian is currently able to sell cars in 25 states and the District of Columbia, but not Ohio.
'Irrational In The Extreme'
"Ohio's prohibition of Rivian's direct-sales-only business model is irrational in the extreme: it reduces competition, decreases consumer choice, and drives up consumer cost and inconvenience—all of which harms consumers—with literally no countervailing benefit," Rivian's lawyers wrote in the suit.
Rivian customers in Ohio currently have to buy their cars in other states that allow direct sales, after which they're shipped to a Rivian service center in the Buckeye State for delivery. Rivian is asking the court to grant it a dealership license so it can sell vehicles in the state. Such a license was previously granted to Tesla, which has been selling cars directly to customers in Ohio since 2013.
The obstacle Rivian faces is a 2014 law, which the automaker says came after intense lobbying by the Ohio Automobile Dealers Association (OADA) that essentially shut the door behind Tesla, allowing that firm to keep its dealer license but blocking other manufacturers from obtaining one.
The Fight Continues
Tesla's Ohio situation is a result of the state-by-state legal battles the automaker fought in the its early days of volume sales. It was able to win concessions for itself, in some cases, but state dealership lobbies were too entrenched to achieve any broad concessions in favor of direct sales. That leaves Rivian and other upstart automakers to re-fight these battles.
Rivian, along with Lucid, was granted a dealership license in Illinois in 2021, and the automakers successfully fended off a legal challenge from that state's dealer association to block direct sales. In 2022, Lucid also filed a lawsuit in Texas challenging that state's direct-sales ban. That suit was unsuccessful, but Lucid has appealed, according to federal court records.
Not every automaker has gone the direct-sales route. Polestar adopted a hybrid approach, with company-owned showrooms and online sales, but servicing handled by Volvo dealers. Vinfast initially planned for direct sales only, but later pivoted and signed up some franchised dealers. The Volkswagen Group's new Scout Motors brand has discussed direct sales, but is already facing legal challenges from the VW Group's franchised dealers.
Ohio Lets Tesla Sell Cars Direct—Rivian Wants the Same first appeared on Autoblog on Aug 9, 2025
This story was originally reported by Autoblog on Aug 9, 2025, where it first appeared.
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