In an intense bid to sway the balance of the Wisconsin Supreme Court, Tesla CEO Elon Musk and allied political entities have funneled substantial funding into a significant judicial race, while Tesla itself is entangled in a legal battle over dealership laws in the state. Tesla is challenging a restrictive Wisconsin statute that bars automakers from operating their own dealerships, a law seen as a major obstacle as the company attempts to establish its presence in the state. This litigation could potentially ascend to the state’s highest court, prompting Musk’s financial engagement in the race.
Tesla has repeatedly tried to establish its own dealerships in Wisconsin, only to face legal barriers. State legislation mandates that vehicle sales and service must be conducted by third-party dealers. This regulation, dating back to the 1930s, was designed to prevent manufacturers from surpassing independent dealers by offering vehicles directly to consumers, a move Tesla seeks to accomplish. In January, the company launched a legal effort to obtain an exemption, coinciding with Musk-supported political groups beginning to endorse Brad Schimel. Schimel, a Republican candidate in the Wisconsin Supreme Court race, is running against Democrat-supported Susan Crawford.
Musk, the wealthiest person globally and known for supporting former President Donald Trump’s workforce reduction agenda, has contributed $3 million to the state’s GOP. Additionally, political action committees connected to him have pumped over $17 million into the judicial race. This financial influx caps an unprecedented spending spree, making it the most expensive judicial race in U.S. history. The total expenditure has surpassed $80 million as the election approaches its final voting day on April 1.
Critics of Schimel have accused Musk of attempting to secure a favorable outcome for Tesla if the dealership case reaches the state Supreme Court. The Wisconsin law, which Tesla disputes, is aimed at preventing manufacturers from directly operating dealerships and thus protecting independent dealers from being outcompeted.
Tesla sells its vehicles directly, directing consumers to pick up their purchases from dealerships in neighboring states like Minnesota or Illinois if they reside in Wisconsin. The company argues that its approach best serves public interests by setting uniform standards and maintains that independent dealers offer less transparent pricing structures.
Despite endeavored legislative adjustments, including proposals passed by Republican lawmakers in 2017 and 2021 along with a vetoed budgetary exemption in 2019, Tesla’s efforts to alter the law have been thwarted. Wisconsin’s automobile dealers association remains staunchly opposed to any exceptions, advocating for consumer protection through third-party dealers.
In January, Tesla initiated a legal campaign to pursue permission to establish four dealerships in Wisconsin, claiming that the current law infringes on its economic liberties and primarily exists to guard independent dealers against competition. The lawsuit is currently in Milwaukee County Circuit Court, with no scheduled hearings.
The battle for the Wisconsin Supreme Court seat holds national significance due to its potential to either maintain Republican control or shift it to the Democrats. This outcome could impact key legal issues, such as abortion rights, labor unions, and district redrawing.
Musk’s involvement in the race was underscored shortly after Tesla’s lawsuit, as he encouraged Wisconsin votes for Republican candidates via Twitter, linking it to preventing voting fraud. Despite this claim, thorough recounts and audits have verified Democrat Joe Biden’s 2020 victory in Wisconsin.
Financial backing for Schimel from Musk-supported groups has been substantial. The contributions, amounting to millions, have bolstered Schimel’s campaign amid accusations of Musk’s attempts to sway the judicial outcome in Tesla’s favor.
Crawford’s camp argues that Musk’s donations are strategically timed to ensure Schimel’s success and thereby secure a conservative majority that may rule favorably for Tesla. Through debates, Crawford criticized Musk’s dominance over Schimel’s campaign. However, Schimel insists that his decisions will remain impartial, irrespective of any financial contributions.
Meanwhile, Crawford has similarly stated impartial intentions, despite receiving significant campaign donations from wealthy individuals like George Soros and Illinois Governor JB Pritzker, aimed at supporting the Democratic agenda in Wisconsin.