Why Tesla Is Opening Showrooms Where Cars Can't Be Purchased The latest showroom is in Michigan, a state famously opposed to direct-to-consumer vehicle sales.

By Nina Zipkin

Bloomberg | Getty Images
The second row seats of the Tesla Motors Inc. Model X sport utility vehicle (SUV).

Elon Musk's electric car maker Tesla is known for being on the vanguard of automobile technology. But sometimes even the most disruptive companies find themselves up against intractable boundaries -- in this case, U.S. auto industry regulations.

In several states, such as Connecticut, Michigan, Texas and Utah, Tesla hasn't been able to shake a ban on direct-to-consumer sales of its vehicles. To get around it, the company has opened gallery showrooms in some states, where customers can view but not purchase Tesla vehicles. Last week, Tesla opened a new showroom inside a Nordstrom store at Somerset Collection, a shopping complex in Troy, Mich., The Detroit News reports.

Located in the Motor City suburbs, the 700-square-foot Tesla gallery is the first of its kind in Michigan and will be open for six months. Gallery attendants are not allowed to discuss pricing information or schedule test drives. Customers have to either order online and schedule a home delivery or travel to a store in Cleveland, Ohio, more than 200 miles away.

In 2014, Michigan passed an amendment which states that manufacturers may sell cars only through a "network of franchised dealers." Still, there are reportedly already about 400 Tesla's registered to owners in Michigan. Tesla is hoping to get more of its vehicles on the road by taking advantage of a legal loophole.

Nina Zipkin

Entrepreneur Staff

Staff Writer. Covers leadership, media, technology and culture.

Nina Zipkin is a staff writer at Entrepreneur.com. She frequently covers leadership, media, tech, startups, culture and workplace trends.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Leadership

7 Telltale Signs of a Weak Leader

Whether a bully or a people pleaser who can't tell hard truths, poor leadership takes many forms.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Business News

Elon Musk's DOGE Is Hiring People Eager to 'Work Long Hours' to Eliminate 'Waste, Fraud and Abuse' in the Government. Here's How to Apply.

The Department of Government Efficiency is hiring U.S. citizens to help cut spending and headcounts in the federal government.

Business News

'Everyone Can Profit From It': What Is DeepSeek? China's 'Cheap' to Make AI Chatbot Climbs to the Top of Apple, Google U.S. App Stores

DeepSeek researchers claim it was developed for less than $6 million, a contrast to the $100 million it takes U.S. tech startups to create AI.

Business News

'I Love Doing Product Reviews': Bill Gates Stepped Down from Microsoft in 2020, But Admits He Still Spends 15% of His Time Working at the Company

In a new interview with the Wall Street Journal, Gates also said he is still close with Microsoft's CEO Satya Nadella.

Business News

Uber's CEO Says Drivers Have About 10 Years Left Before They Will Be Replaced

Uber CEO Dara Khosrowshahi says the jobs of human drivers are safe for the next decade, but after that, another type of driver will take over.