Rivian Sues Ohio to Enable Direct Electric Vehicle Sales

Rivian has initiated legal action against the state of Ohio, filing a lawsuit to enable direct sales of its electric vehicles to consumers within the state. This move marks the latest development in an ongoing debate between innovative automotive manufacturers and traditional dealership networks.

The electric vehicle maker sued the registrar of Ohio’s Bureau of Motor Vehicles (BMV) in federal court, asserting that Ohio’s current regulations hinder direct sales, thereby harming consumers. Rivian currently operates under a direct-sales model in 25 states and Washington, D.C.

According to Rivian’s legal team, Ohio’s prohibition on direct sales is “irrational in the extreme.” They argue it stifles competition, limits consumer choice, and increases costs and inconvenience for buyers, offering no discernible benefit to the public.

Ohio customers wishing to purchase Rivian vehicles must currently do so from locations in states where direct sales are permitted, with the vehicles subsequently being shipped to Rivian service centers within Ohio. Rivian seeks court permission to apply for a dealership license to streamline this process.

Rivian points to Tesla as a precedent, noting that Tesla has held a license for direct sales in Ohio since 2013. The core of Rivian’s challenge is a 2014 state law, allegedly influenced by lobbying from the Ohio Automobile Dealers Association (OADA). Rivian contends this law created an exception for Tesla while preventing future manufacturers from obtaining similar direct-sales licenses.

Rivian’s Chief Administrative Officer, Mike Callahan, stated, “Consumer choice is a bedrock principle of America’s economy. Ohio’s archaic prohibition against the direct-sales of vehicles is unconstitutional, irrational, and harms Ohioans by reducing competition and choice and driving up costs and inconvenience.” The Ohio BMV and OADA did not immediately respond to requests for comment.

Rivian has a history of success in similar legal battles. In 2021, Rivian and Lucid Motors secured dealership licenses for direct sales in Illinois, successfully defending against a lawsuit from the state’s dealer association. Lucid Motors also pursued a case in Texas in 2022 challenging direct-sales bans, although the initial court ruling was unfavorable, the company has filed an appeal.