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Tesla Allowed to Sell Cars in Ohio, Following N.J. Ban

Tickers in this article: TSLA

Updated from 11:12 a.m. to include comment from Tesla.

NEW YORK ( TheStreet) -- Following a ban to sell its cars directly to consumers in New Jersey, Tesla Motors is now free to do so in Ohio.

Earlier this month, news broke that Tesla had met with the Ohio Automobile Dealers Association about selling its popular Model S directly to consumers. Following discussions with Ohio auto dealers about Senate Bill 260, which would have banned Tesla from selling directly, Tesla is now free to do so in its two stores in the state, one based in Easton and the other in Cincinnati. The deal between the association and Tesla was approved by a Senate panel, according to the Associated Press .

Diarmuid O'Connell, Tesla's VP of Corporate & Business Development, said the company was happy to reach an agreement in Ohio. "We're pleased with the compromise reached in the Senate Committee to amend SB 260 to allow Ohio residents to continue to purchase electric vehicles directly from Tesla at our two existing stores and one additional location in Ohio," O'Connell said in an emailed statement. "Tesla stores are essential to educating customers about electric vehicle technology and building a mass market for EVs. We look forward to continuing to provide our Ohio customers with the full Tesla experience and to further investing in the state by employing Ohioans both directly at our stores and service centers, and through our Ohio-based suppliers of parts and components."

Not only can Tesla sell directly to consumers in its two existing stores, but it allows for Tesla to open a third store in Cleveland. However the deal prohibits the Palo Alto, Calif.-based company from opening any more stores in the state. As per the agreement, Tesla is the only automaker allowed to operate its own stores in the state.

Tesla's right to sell directly to consumers has come under intense scrutiny in recent weeks, following a ban in the state of New Jersey, effective April 1. Tesla said New Jersey Governor Chris Christie had gone back on his word to allow the matter of selling directly to consumers to be open for discussion. Christie fired back, saying he wasn't pushing Tesla out, he was only enforcing laws already enacted. "I'm not pushing Tesla out; the state Legislature did," Christie said last week. "They passed a law, which is still on the books, which says if you want to sell cars in this state, you must go through an authorized dealer. My job is not to make the laws, it's to enforce the laws. And Tesla was operating outside the law."

New Jersey State Assemblyman Tim Eustace (D-Bergen) has since introduced a bill that would let electric car companies sell directly to consumers.