Rivian Challenges Ohio's Ban on Direct-to-Consumer Sales, Claims it Hurts Competition and Limits Customer Choice.

Rivian (RIVN) is suing Ohio's Department of Motor Vehicles over a law that bans direct-to-consumer sales. Rivian argues that the ban is "irrational" and hurts competition, while Tesla is allowed to sell directly through a special deal. The lawsuit claims that the ban violates economic freedoms and should be overturned. Analysts have a Hold consensus rating on RIVN stock with an average price target of $14.92 per share, implying 20.2% upside potential.

Rivian, the electric vehicle (EV) manufacturer, has filed a lawsuit against Ohio's Department of Motor Vehicles (DMV) over the state's partial ban on direct car sales. The company argues that the law, which restricts direct sales by manufacturers but includes an exception for Tesla, is "irrational" and harms competition. Rivian contends that the ban violates economic freedoms and should be overturned.

Ohio's law requires that new or used motor vehicles be sold through independently owned car dealerships, except for Tesla, which has been granted an exception. Rivian's Chief Administrative Officer, Mike Callahan, stated that consumers should have the choice to purchase vehicles directly from the manufacturer. He claims that the ban is unconstitutional and reduces competition, driving up costs and inconvenience for Ohio consumers [1].

Rivian's lawsuit highlights the illogical situation created by the ban. The company is allowed to perform repairs and deliver cars to Ohioans, but cannot complete the sale of Rivian vehicles in the state. This imposes an extraordinary burden on both consumers and Rivian, according to the company's statement.

Historically, bans on direct car sales were implemented to prevent large, established car companies from monopolizing sales. However, Rivian, along with other EV makers, has differentiated itself by offering direct-to-consumer sales. The company's lawsuit suggests a broader goal to challenge and potentially overturn the ban, similar to its previous successful legal battle in Illinois [1].

Analysts have a Hold consensus rating on Rivian (RIVN) stock with an average price target of $14.92 per share, implying a 20.2% upside potential. The lawsuit could impact Rivian's stock performance, depending on the outcome.

References:
[1] https://www.engadget.com/transportation/evs/rivian-sues-ohio-dmv-over-partial-ban-on-direct-car-sales-191259497.html