Electric vehicle maker Rivian filed a lawsuit against the Ohio Bureau of Motor Vehicles this week in an effort to force the state to lift its ban on direct-to-consumer vehicle sales. Rivian is one of a number of new EV startups since Tesla that has abandoned the dealership model for selling cars, but as things currently stand, that remains illegal in many states.
The prohibitions on direct car sales date back to the early days of the automobile and fears that the big American car companies would become too vertically integrated. But there were other benefits to the car companies—supplying cars to franchised dealers allowed them to concentrate their capital on things like production lines and factories rather than a nationwide distribution system.
That’s pretty much how things stayed until the early 2010s—despite a Justice Department report in 2009 that found the laws were harmful to consumers, when a new automotive startup called Tesla decided it wanted to go another way.
