DES MOINES (AP) — The Iowa Department of Transportation told Tesla Motors to stop offering test drives in the state, saying the electric car company is not a licensed auto dealer in Iowa and state law bars carmakers from selling directly to the public.
A Tesla spokeswoman said the company does not think the statutes apply because the company was offering only three-day test drives, not selling cars, the Des Moines Register reported.
Palo Alto, California-based Tesla does not sell its electric cars through franchise dealerships. People can buy the Model S online or at one of a handful of Tesla stores around the country.
Tesla had set up in a hotel parking lot in West Des Moines on Sept. 9, planning on offering three days of test drives. It canceled the last day after speaking with the Iowa Transportation Department.
Kelly Hart of Windsor Heights was scheduled to take a test drive on the third day. He said he would like to see Iowa laws altered to let Tesla test drives happen.
"I hope they get it changed because it's just ridiculous," he said.
Paul Steier, director of the Transportation Department's bureau of investigation and identity protection, said the Iowa Automobile Dealers Association had alerted the state agency to the test drives.
The association's president, Bruce Anderson, said state law requiring auto dealers to be licensed protects consumers. To get a license, dealers must be insured and have a location where buyers can go if they have a problem with the vehicle.
"You can't just set up in a hotel parking lot and sell cars," Anderson said. "It's not a Tesla issue. This is a regulated industry."