Rivian Sued For Direct-To-Consumer Selling Model

• The State of Illinois is also involved in the lawsuit.

• Lucid Motors is another defendant in this suit.

This debate comes down to dealer groups looking to provide steady-paying jobs. The issue with dealership models is that they increase costs which are passed on to consumers. Tesla has managed to partially break the mold by being granted a limited license to sell its vehicles.

In this lawsuit, the Illinois Automobile Dealers Association (IADA) and the Chicago Automobile Trade Association want to prevent Rivian and Lucid from also using a direct-to-consumer selling model.

Rivian and Lucid will open showrooms in Chicago and Oak Brook where potential buyers can explore and find out more about the vehicles for sale. The lawsuit, as reported by Chicago Business (subscription required), alleges that Rivian was supposed to request a dealer license in order to sell its vehicles, which it has not done. Lucid has not applied for a dealer license either.

Both sell their vehicles online which is, in large part, a reason why a dealer license is not actually necessary. This conflict between manufacturers and dealer associations dates back to Tesla and given the number of start-ups intending to launch new products, the fight is far from over.