COLUMBIA, SC — Traditional auto sellers have been very against a bill that would have let Volkswagen-backed Scout Motors sell its electric SUVs directly to people in South Carolina, where the cars will be built. The bill has now been put on hold.
This week, a House subcommittee held a well-planned meeting where they heard evidence for only one hour from Scout and people who support it, as well as from dealers and people who are against direct sales. Then they stopped debating the bill, so it probably won’t be settled before the end of the legislative session in May.
Scout, a company based in Virginia, has worked hard to get the General Assembly to allow people in South Carolina to buy a car through its app and then use it to handle fixes, updates, and upgrades, which are usually done by dealers.
In response, car dealers said that their costs and services are competitive. They say that because they live and work in the same area, they can respond more quickly to problems. The dealer system has worked for decades.
About twenty states, including South Carolina, don’t let automakers sell cars directly to customers. Instead, they require people to buy new cars from a dealer.
Republican Gov. Henry McMaster was interested in the short subcommittee meeting on Wednesday. He said that the Republican-controlled General Assembly owed Scout a more thorough review of its request since the company is building a huge factory in Blythewood, just north of Columbia. The state is giving Scout more than $1 billion in tax breaks for the plant. The first car is expected to be made there in 2027.
McMaster said Thursday, “On a bill with a good company that has invested billions of dollars in South Carolina hiring to start with 4,000 high-paying jobs… we ought to give them the courtesy of having a full debate, let everyone have their say, then take a vote.”
Supporters of Scout came to the Statehouse on Wednesday in droves, wearing hard hats and bright orange and yellow vests. At least a dozen car dealers and their workers dressed in business casual also showed up. For everyone who wanted to go to the meeting, an extra room had to be made available.
People who like Scout Motors said it was just a matter of choice. Why shouldn’t cars be one of the things that can’t be bought online, like clothes, jewelry, and laundry detergent?
“This bill is for people who believe in freedom.” For those who value individual freedom, this bill is a good choice. “If you believe in less government control and economic growth, then you should support this bill,” said Cody Thacker, Vice President of Growth for Scout. He said that his company expected to add 10,000 jobs and $4.2 billion to South Carolina’s economy.
Dealers said it’s not as easy to buy a car as it is to buy a shirt. There are fees, taxes, rules, and complications if someone wants to test drive or isn’t happy with what they got.
In Greenville, Marc White sells Volkswagens. He told the panel that he had offered to sell Scout cars at his company but had not heard back.
White said, “I would never want the state to give Scout more than a billion dollars and then have them compete with my family business, which we built without any help from the government.”
Executive vice president of the South Carolina Automobile Dealers Association Sims Floyd focused on the state money that was given to Scout. This has become a point of disagreement for some who believe that the state gave too much.
Floyd said, “The 47 dealers behind me and in the second room have built their businesses from scratch.” “They began with nothing.” They never asked the government for money. They didn’t think the government would give them money. They always pay their taxes on time.
Even if direct sales don’t work out, Scout has said it will still make its cars in South Carolina and will keep trying to change the law for itself and other electric car companies like Tesla and Rivian.
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