Texas Dealer Fight Prompts Tesla to Hint of Future Plant

Tesla Motors Inc., which is battling car dealers in Texas for the right to sell its electric vehicles directly to consumers, tells Automotive News the company would consider building an assembly plant there in as little as three years.

CEO Elon Musk says that when Tesla needs more capacity than its factory in Fremont, Calif., can provide, Texas would be a "leading candidate" for a second facility, the newspaper reports. Musk adds that the plant might build electric pickup trucks.

The Texas legislature is considering a bill that would make EV makers an exception to the state law that allows only franchise dealers to sell vehicles there. The Texas Automobile Dealers Assn. opposes the legislation.

Musk testified before Texas lawmakers earlier this week, noting that Tesla would create local jobs and spend "tens of millions" to outfit its stores. He says the company could sell as many as 2,000 cars in the state next year if the bill is passed.

Tesla currently operates galleries in Austin and Houston, which can't offer test drives. The staff there is not allowed to discuss pricing, leasing or financing.

Tesla has 16 company-owned stores in 12 states. But dealers in some locations are suing to shut down those facilities.