This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Tesla Takes a Hit From NJ Direct-Sale Ban

Stocks in this article: TSLA

In the blog post, Musk recommended people in New Jersey who want to purchase Tesla vehicles cross the Hudson River and go to the Tesla showroom in lower Manhattan. Unless New York puts in its own ban on direct sales.

Now, most important:

How will this affect Tesla's stock price?

TSLA is a trading favorite among many of my day/swing trader friends and mentors. The volume is strong, the swings are violent and full of fun and trader sentiment is always very clear, making it easy to trade the stock off trader psychology.

The abolition of Tesla's car sales in any single state will hurt the company and cut into Tesla's market share.

Even though New Jersey only represented a small share of Tesla's total sales, N.J. was still marked as fourth-largest market for luxury automobiles following New York, Florida, and California. Tesla's Model S car can be priced over $100,000 and definitely fits in the 'luxury automobile' category.

Now that New York is heavily considering a ban as well, that could have a serious effect on Tesla. New York is the third most populated state in America, with 8.3 million people. In front of New York is California at #1 and Texas at #2.

Tesla's stock price has risen 554% over the past year, going from the stock's close on March 21st, 2013 ($36.01) to last Friday, March 21st ($236.50.)

No short term damage was done to Tesla's stock price in response to the announcement of the news on March 11th, where the stock price closed at $236.50.

I think Tesla's stock may eventually see some short-term affects of a falling stock price, due to the company not being able to make sales how it wants to in various states. 

However, I think Tesla's new way of selling automobiles will eventually become the new normal.

The people of New Jersey have already decided to fight back. Via the political crowd funding platform FundElevator, people are starting to raise money for a lobbying effort against New Jersey and the enforcement of this law.

"Tesla is changing the world and keeping American greatness alive. We can't let special interests and political corruption get in the way of that."

The consumers have spoken. People love this very innovative way of doing business and I think as the younger generation moves up, we'll adapt to the changes Mr. Musk is pioneering in our current system. Musk comes from the internet world, a world where there are far fewer contracts, rules, regulations, and middle men. It's a simpler way. I believe it's where we are headed.

Go Elon Musk, go innovation, and go the next generation of car sales.


Many Happy Returns,


At the time of publication the author had no position in any of the stocks mentioned.

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,164.95 -251.90 -1.45%
S&P 500 1,994.99 -26.26 -1.30%
NASDAQ 4,635.24 -48.1670 -1.03%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs