The ‘Tesla exemption’ is gone: Rivian and Lucid break through the wall of the Washington sales area

Early next year, Washington state consumers will be able for the first time to visit Rivian and Lucid Motors showrooms, take a test drive, discuss financing, and walk out with the keys to their new electric vehicle.

State lawmakers this week passed Senate bill 6354, which allows two EV makers to join Tesla in selling their vehicles to consumers, bypassing auto dealers that sell all types of vehicles. SB 6354 passed with overwhelming support in the Senate and House, and supporters are hopeful that Gov. Bob Ferguson will sign the measure.

“This bill is a huge step forward in making EVs more accessible in Washington,” said Leah Missik, Washington legislative director for the nonprofit Climate Solutions.

Rivian and Lucid have repeatedly tried to win this way of selling EVs, but sellers in the past have tried hard against expanding the exemption. They said manufacturer stores may be limited in number and located in urban areas, providing less access to repairs and recall repairs. The direct sales channel eliminates competition between auto dealerships, opponents argue.

The tide changed when Rivian recently launched an effort to put the issue before voters in November. The founding campaign pledged to raise more than $20 million and has received nearly $4.7 million in donations so far.

Unlike the voting process, the legislative process gave dealers a formal role in shaping the final rules and the result shows: The bill limits exemptions and prevents small and emerging automakers from direct sales. Washington merchants this year supported SB 6354, and Greg Rairdon, whose family owns 13 businesses, called it “the right compromise.”

However, manufacturers including Honda, Ford, General Motors and the National Association of Automobile Dealers opposed the bill.

Some important aspects of the law:

• Creates a $10,000 fine for each vehicle sold or leased by manufacturers not authorized for direct sales.
• Raises vehicle title payments from $15 to $40 by 2036, with additional funds earmarked for EV purchase/lease support for low-income and environmentally-disabled residents, as well as walking and pedestrian measures.

Oregon, California and many other states already allow all EV manufacturers to offer direct sales, while Washington lawmakers gave Tesla the only direct sales exemption in 2014. Rivian and Lucid buyers have had to buy cars out of state or online.

Washington leaders are looking for more strategies to boost EV sales. The state is among those that have joined California in requiring all new vehicles sold to be zero-carbon by 2035. It’s an ambitious goal and the Trump administration has challenged these efforts, cutting EV tax credits and working to meet California’s tougher pollution laws.

The state needs to “use every tool in our toolbox to cut climate pollution,” Misik said. “And expanding direct sales to EV manufacturers is one of them.”