South Carolina Scouts! Your voice is heard: Direct sales bill gets a hearing on Wednesday!

[codythacker]

I really, really appreciate everyone that followed along yesterday, and especially those who reached out to the SC legislature beforehand.

For those of you unfamiliar with the quirky world of legislative procedure, you may have been confused by the end of the hearing and are asking, “what exactly was the verdict here?”

The subcommittee had four primary options yesterday: to vote no (absolutely killing it), to table the bill (effectively killing it), to adjourn debate (delaying a vote), or to vote yes (moving the bill along in the House of Representatives).

Instead of taking a vote to either kill or advance the legislation, the subcommittee decided to adjourn debate, effectively hitting the pause button. That means they can bring it up again for a vote later in the legislative session if we keep up the pressure, which we certainly will.

The closing statement by Rep. Chris Wooten, a Republican for Lexington, was perhaps the oddest moment of the day. After hearing all of the testimony about consumer abuses by SC franchise dealers, direct sale manufacturers offering a better service experience, and franchised dealers being unharmed by allowing all sales models to function in the state, Rep. Wooten stated (in so many words) that his daughter once had a good service experience at a franchise dealer, thus he did not support reforming the law to allow consumer choice in car buying.

South Carolina media covered the story with headlines like, “Auto dealers rev up pressure on SC lawmakers amid Scout Motors' EV direct sales push.” Despite the pressure from dealers, we’re committed to giving South Carolinians the freedom to buy our groundbreaking vehicles directly from Scout Motors.

Lastly, I've pasted below the testimony that I offered to the committee:

Chairman, Members of the Committee,

My name is Cody Thacker. I serve as the Vice President of Commercial Operations at Scout Motors and I appreciate you allowing me to speak today.

I want to specifically thank the bill sponsor, Chairman Smith, for championing consumers and bringing this important issue on direct auto sales out into the open.

As a preliminary matter, it’s worth recognizing some of the voices that aren’t here due to today's time constraints, but who nonetheless have strong opinions: Virtually all economists, academics, free market advocates, conservative think tanks, consumer protection groups, the DOJ, and the FTC oppose bans on direct sales. These groups will tell you directly: laws like the one in South Carolina are anti-competitive, anti-free market, and anti-consumer.

So, here’s our opportunity: instead of being stuck in the past, we can look forward and ready ourselves for the future. For South Carolina, that means removing regulation that stands in the way of attracting the world’s best companies and jobs.

For Scout Motors, that means deploying cutting-edge technologies to make vehicle purchases brutally simple and fast, to reduce vehicle prices by thousands, and to keep our Blythewood plant running at full capacity.

Importantly, no one here today is asking for the franchise system to be dismantled. Nobody is asking to put franchised dealers out of business. We’re simply asking South Carolina to remove an antiquated regulation that prevents consumers from making their own economic decisions.

Until 2000, South Carolina had something special, but fragile, in auto retail: freedom for its citizens. This meant that both auto distribution models—direct and franchise—freely operated in the state, just as they do throughout the United States and in nearly all other countries around the world, including socialist and communist countries.

But how right John C. Calhoun was…liberty is indeed harder to preserve than to obtain.

After this legislature passed a dealer bill deemed patently unconstitutional in 2000, the dealer lobby has continued to pursue more and more protectionist regulation to shut out competition.

And what has that gotten us? Consumer abuse is skyrocketing in our state. For 2024, complaints against dealers are on track to double from 2018 levels. And all under the auspices of a law that purports to “prevent frauds and other abuses upon citizens.”

How could anyone think this status quo is acceptable? The dealer lobby says three things:

• One: Scout Motors received state incentives. Thus, they claim, citizens don’t deserve freedom. Nonsense. State incentives for Scout Motors and the liberty of citizens are unrelated.

• Two: The dealer lobby claims that removing protectionism will harm dealers, and therefore community investment will shrink. Again, nonsense. A) The bill does not touch any dealer with an existing franchise agreement. In all the places around the world where direct sales are permitted, franchise dealers continue to thrive. And B) We’re also here in the South Carolina community, paying taxes, sending our kids to little league, and participating in charitable causes. Thousands of us are your neighbors too, just like franchised dealers.

• Third—and now we get to the truth of the matter—the dealers vocally claim that this bill would add competition to the market. Yes. Yes it will. We want competition in the market. Competition is good. Why would any of us be opposed to consumer choice, lower prices, and curbing the abuses under current law?

The bottom line, all of the arguments of the dealer lobby amount to one thing: pleas for more protectionism.

But there’s a better way for South Carolina – one that maintains the benefits that franchise dealers seek, one that allows innovators to flourish, and one that restores liberty. And that better way is the South Carolina Consumer Freedom Act

• If you believe in liberty, you support this bill.
• If you believe in consumer freedom, you support this bill.
• If you believe in de-regulation and economic prosperity, you support this bill.

In conclusion, I’m here to create 10,000 jobs for South Carolinians. I’m here to put $4.2 billion into the economy each year. I’m here to make American manufacturing great again.

Today, all I’m asking for is enough common-sense de-regulation to give my company—and our customers and employees—a chance to carry out our vision.

 

[THil08]

Scouts Lead The Way; Go First, Go Farther

 

[Nmagnatta]

Instead of taking a vote to either kill or advance the legislation, the subcommittee decided to adjourn debate, effectively hitting the pause button. That means they can bring it up again for a vote later in the legislative session if we keep up the pressure, which we certainly will.

Make sure that people keep an eye out for when this will be. They knew they had a lot of eyes on them yesterday, Make sure we keep up the pressure.

 

[Czernobog]

Craig Gagnon (R-Abbeville) is one of the co-sponsors on the bill, yet he had previously indicated in a response to an interviewer's question that he had yet to make a decision on whether to support it. Was there any indication during the hearing that all 4 of the bill's co-sponsors are now fully backing it?

 

[CAJ]

I suspect you are getting significant interference on the state reps coming out of Washington DC. . seems like some dude who also makes electric cars and a so called truck would be interested in limiting the competition!

 

[Czernobog]

I suspect you are getting significant interference on the state reps coming out of Washington DC. . seems like some dude who also makes electric cars and a so called truck would be interested in limiting the competition!

That seems highly unlikely, since the same the auto company headed by dude you seem to be referencing is also blocked in the same way as Scout from direct sales in SC, by the same law.

 

[J Alynn]

That seems highly unlikely, since the same the auto company headed by dude you seem to be referencing is also blocked in the same way as Scout from direct sales in SC, by the same law.

The enemy of my enemy is my ally

 

[J Alynn]

As a side note and this may have already been discussed but VWAG owns Ducati and as a lifestyle vehicle they could sell Scouts through those dealers. Ironically there are a couple around Blythewood and Columbia.
I would love to see the dealership faces on that move. Sell the outdoors, nature aspect. I realize Ducati isn’t that niche but would be a great power move.

 

[bwdavis7]

Rep. Wooten stated (in so many words) that his daughter once had a good service experience at a franchise dealer, thus he did not support reforming the law to allow consumer choice in car buying.

First of all, thanks for the clarification of the outcome. I was also taken back by the comments at the end after such strong points given in favor by you and the other speakers versus the weak {non-consumer} points by those against. If you consider Rep Wooten's point about his service experience, he all but admitted the "good ole boy system" stereotype of how our legislation works. As I stated earlier, it was clearly his political influence that he got the service he wanted, not because the dealership treats ALL their customers with such great care. If I were standing toe to toe with Rep. Wooten I could give him examples of my direct experience with that particular dealer and another Southeast Toyota dealer that would make the average consumer cringe. If this bill could get on a ballot in the future it would be a no brainer. All dealerships aren't necessarily bad, but the integrity of many...well you know.
As for Rep. Wooten and those not standing up for South Carolinians, I have relatives that live in his district. I have some, although little, influence.

 

[Derek]

Meanwhile, in Washington: https://www.seattletimes.com/opinio...-tesla-in-selling-cars-directly-to-wa-buyers/

Interesting, I'm worried if they keep the "zero emission" in the restriction vs just "never been sold through dealers here" clause. It seems that might rule out the Harvester as an available direct purchase.

 

[eddiet1212]

The NADA & SCADA definitely have a protectionist agenda and it appears that the demagogues are working overtime.

I hope that laws are changed to prevent them from the ongoing interference with our Constitutional freedoms & consumer choice….

As stated, there is enough room in the market for both D2C & dealerships.

 

[oldgeeksguide]

Back in the 1990's Ferrari dealerships across the US were in horrible shape. It was so bad that in 1994 Ferrari launched a factory-owned dealership just north of San Francisco. The main point was to show their North American dealers how to run a business from sales, service, customer relations, finance, even the beautiful Italian looking facility itself. Think of it as a training hospital but for cars. While yes this created some localized competition, the bigger picture was this tool helped completely turn around the quality of the dealer network. With mission accomplished, Ferrari sold it in 2009.

In all the anti-dealership arguments I've read, not once have I heard someone say we should throw out Lexus dealers. Why? Because they're excellent proving it's not buying through a 3rd party dealer that's the problem, it's the quality of the dealers themselves. In the same way Ferrari taught their dealer network how to run a modern dealership, Scout is in the position to teach VWoA and it's dealer network how to run a business in modern times. I hope both parties are savvy enough to take note.

View attachment 5166
Dealer brochure from back in the day.

Ferrari of San Francisco Brochure

Official brochure of the Premier Dealership in San Francisco, California. Highligts some of the jewels on display: Ferrari 250 GTO, Ferrari 333SP, Ferrari F40 and more.PRODUCT DETAILS Albaco SKU#: sx067 Year: Month: Day: Language: English Prod # / ISBN: Author: Brand / Manufacturer: Ferrari of...

albaco.com

I think the issue is not about specific brands, it’s about restricting consumer choice and manipulating the law to create a monopoly that leads to various abuses of the type we’ve all experienced and read about. Any decent dealership that treats people fairly and adds value should not be afraid of some competition.

 

[chucchinchilla]

Putting Scout's vision into their paradigm and correctly using their buzzwords like liberty, consumer freedom, de-regulation, and economic prosperity is a brilliant move and one I was hoping would be made. At it's core, voting against this bill is voting against the very principals they profess.

 

[chucchinchilla]

I think the issue is not about specific brands, it’s about restricting consumer choice and manipulating the law to create a monopoly that leads to various abuses of the type we’ve all experienced and read about. Any decent dealership that treats people fairly and adds value should not be afraid of some competition.

While my example involved a specific brand, the bigger picture of the story is one of mutual benefit for both consumers and dealers. To your last sentence remember we're talking about VW dealers here so they're very afraid lol.

 

[Czernobog]

The short subcommittee meeting on Wednesday caught the attention of Republican Gov. Henry McMaster, who said the Republican-dominated General Assembly owes Scout a more thorough vetting of its request since the company is building a massive manufacturing plant in Blythewood just north of Columbia.

...

“On a bill with a good company that has invested billions of dollars in South Carolina hiring to begin with 4,000 high paying jobs ... we ought to give them the courtesy of having a full debate, let everybody have their say then take a vote,” McMaster said Thursday.

From updated local media article https://www.wistv.com/2025/02/14/sc...ctly-sell-its-electric-suvs-sc-buyers-stalls/

 

[N Wilson]

Another thing that should be highlighted to legislators in SC in future hearings is the potential economic boon to Blythewood, and the surrounding area.

Think about the ripple effect of people coming from all over the country to pick up their Scouts, and while in the area they will likely stay at local hotels, eat at local restaurants, shop at local stores, etc.

The flip side is the huge missed opportunity if the legislature votes no on this. They will be responsible for a lost revenue stream bringing out of state money into the local SC community.

 

[codythacker]

Another thing that should be highlighted to legislators in SC in future hearings is the potential economic boon to Blythewood, and the surrounding area.

Think about the ripple effect of people coming from all over the country to pick up their Scouts, and while in the area they will likely stay at local hotels, eat at local restaurants, shop at local stores, etc.

The flip side is the huge missed opportunity if the legislature votes no on this. They will be responsible for a lost revenue stream bringing out of state money into the local SC community.

Exactly right. The economics department at USC studied this in detail. They determined that the ripple effects from Scout Motors add $4.2B to the SC economy each year starting in 2029. On top of the 4,000 direct jobs from Scout, they determined that another ~6,000 jobs are created at supplies, vendors, and in the community. Huge, huge economic boost to the state.

And to think, some legislators are willing to trade all of that away to protect dealers…

 

[Czernobog]

Another thing that should be highlighted to legislators in SC in future hearings is the potential economic boon to Blythewood, and the surrounding area.

Think about the ripple effect of people coming from all over the country to pick up their Scouts, and while in the area they will likely stay at local hotels, eat at local restaurants, shop at local stores, etc.

The flip side is the huge missed opportunity if the legislature votes no on this. They will be responsible for a lost revenue stream bringing out of state money into the local SC community.

Exactly the points I raised when writing my reps exhorting them to support passage of the legislation.

Fingers crossed that McMaster's pressure will yield dividends.

 

[rehajm]

…that story about the dealer people assisting the stranded motorist is as old as the hills, long before anyone had a phone to call roadside assistance. I usually hear it when I tell a dealer I don’t want their badging on my vehicle. Your people are going to make a special stop for me but not help someone else? How about you don’t sell me a vehicle that leaves me stranded on the roadside?

 

[LastDayScout]

Another thing that should be highlighted to legislators in SC in future hearings is the potential economic boon to Blythewood, and the surrounding area.

Think about the ripple effect of people coming from all over the country to pick up their Scouts, and while in the area they will likely stay at local hotels, eat at local restaurants, shop at local stores, etc.

The flip side is the huge missed opportunity if the legislature votes no on this. They will be responsible for a lost revenue stream bringing out of state money into the local SC community.

Not that we needed more population growth, but Boeing coming to Charleston has been huge. Mercedes is here now and so is Volvo. Those alone are major economic boosters. When you add all the ancillary business like suppliers, support and services for employees, etc. the results are staggering. But, as a born and raised South Carolinian, I can say that it would be typical SC to build the amazing factory and not be able to sell to our citizens.