The Alliance for Automotive Innovation said on March 17 that Washington state's new electric vehicle (EV) direct sales law creates a legal pathway for Chinese automakers to bypass U.S. franchise dealers.
The organization said the legislation could have significant implications for the automotive retail system, particularly regarding foreign manufacturers' access to U.S. consumers. The group raised concerns about how the law might affect franchise protections and national security policies.
Bozzella said the legislation allows EV-only manufacturers to skip franchise dealers and sell directly to consumers in Washington state. He said the Alliance opposed the plan but it passed with the backing of the Washington State Auto Dealers Association. Bozzella asked why a Chinese automaker would not try to be the next manufacturer approved for direct sales, according to Automotive News.
Washington's SB 6354 passed the state House 84-9 and the Senate 47-2 and awaits the governor's signature. The bill allows direct sales for U.S.-based, EV-only manufacturers that have never used franchise dealerships. Other states could follow, further eroding franchise protections, according to GeekWire.
The Biden administration finalized a rule in January 2025 banning the sale of connected vehicles with software or hardware tied to China or Russia. The U.S. Department of Commerce said the rule addresses national security concerns over data collection and foreign vehicle manipulation. Software restrictions take effect for the 2027 model year and hardware restrictions for model year 2030, according to a press release from the Department of Commerce.
The Alliance for Automotive Innovation is a Washington, D.C.-based trade association representing nearly every major automaker selling vehicles in the United States. The organization was formed in 2020 through the merger of the Association of Global Automakers and the Alliance of Automobile Manufacturers. Bozzella serves as president and CEO, according to information from Autos Innovate.
