Tesla Motors has been banned from selling or test driving its electric cars in the state of Iowa, the Des Moine Register reported.
According to the Iowa Department of Transportation, under state laws, Tesla is prohibited from test driving its products and selling them to the public directly because the electric carmaker is not a licensed dealer in Iowa.
Due to the ban, Tesla cannot sell car through its dealership. Costomers who want to purchase an electric car will have to do so online or through the company's stores. However, they are still not allowed to test drive them in Iowa.
Tesla stated on a press release that it will comply with the law passed by the state's Department of Transportation, according to Time.
"In an effort to comply with the current laws, employees at these galleries are prevented from discussing pricing and the reservation process," the company stated. "This includes any discussion on financing, leasing, or purchasing options. Also, galleries cannot offer test drives."
"The store's interactive kiosks are also amended to remove pricing," Tesla added. "Lastly we are unable to refer the customer to another store out of state.
The company noted that the ban on its operational activities will significantly affect its relationship with customers and its goal of spreading awareness regarding the benefits of using electric cars.
"This puts Tesla at a serious disadvantage and inhibits our ability to reduce misconceptions and educate people about Electric Vehicles and the technology," Tesla explained.
"Furthermore, people are forced to leave the gallery frustrated, lacking sufficient information about the car and the brand," the automaker added.
Iowa has joined other states such as Arizona, Texas, New Jersey, Virginia and Maryland in hindering the activities of Tesla Motors, Tech Times reported.
According to Bruce Anderson, the president of the Iowa Automobile Dealers Association, said Tesla needs a license in order to operate as a legitimate dealer.
"You can't just set up in a hotel parking lot and sell cars," he said. "It's not a Tesla issue. This is a regulated industry."
