A Game Changer in Georgia’s Free Market Fights?

Posted: Dec 10, 2014 12:18 PM

Georgia’s recent domination of rankings of the best state for business are largely predicated on Republican Governor Nathan Deal’s focus on improving the general business climate while courting businesses to locate in the Peach State.

But recently, a set of laws that date back to the era of monopolies and trust-busting has come in for greater scrutiny and the 2015 Session of the Georgia General Assembly could see spirited fighting over the state’s regulation of alcohol distribution, automobile sales, and taxicabs.

A new Georgia Craft Brewers Guild is ramping up to challenge the state’s three-tier alcohol distribution system, which prevents brewers from selling directly to consumers. Neighboring states without this restriction have seen a booming microbrewery industry while the Brewers Guild says Georgia is lagging behind.

Tesla Motors is currently locked in a battle with the existing franchise auto dealers over whether Tesla can sell cars directly to consumers. Franchise auto dealers say they protect consumers, while Tesla argues that only a manufacturer can build out the infrastructure, like specialized fast-charging stations, and train the staff to sell and service a new kind of auto.

Finally, rambunctious upstarts Uber and Lyft are challenging the existing taxi cab licensing structure and appear to have found a powerful ally in Atlanta Mayor Kasim Reed.

But a game changer may have occurred in the automotive fights, courtesy of a company led by local business legend Don Panoz. The developer of transdermal patches, Panoz has since developed a winery, golf community and resort called Chateau Elan, sold race cars, and started the American Le Mans series of racing.

Panoz now owns DeltaWing Technologies, manufacturer of a radical new road racer that would look more at home in the new Star Wars movie than on local streets. The DeltaWing racecar combines low weight, fuel economy approaching that of hybrid racers, and radical looks and may revolutionize racing.

But DeltaWing Technologies also has an eye to bringing its racing design to street cars, but its newest proposal is an electric vehicle based on its high-efficiency car design. The company envisions a lightweight vehicle somewhere between an electric motorcycle and modern micro-compact autos, according to the Atlanta Business Chronicle. The initial target market is municipal governments rather than individual consumers.

But the company recognizes that rethinking transportation may also require rethinking how cars are sold, telling the Business Chronicle,

Rather than building a capital-intensive dealer network, DeltaWing plans to sell the City Car through up to 1,200 retail centers nationwide.

"We don't want to get into the automobile franchised dealer mode, nor do we want to sell direct," said DeltaWing Vice President Don Triolo.

Significantly, the company may also consider developing a ride-sharing service. These two business models both conflict with existing Georgia laws.

One Georgia economic development project that continues to bear fruit is the 2009 opening of Kia Motors Manufacturing Georgia in West Point. More recently, a number of auto manufacturing suppliers have located in the state to serve in-state manufacturing as well as plants in neighboring South Carolina, Alabama, and Tennessee.

Georgia, more specifically Atlanta, has become a major market for electric vehicles, including the number one market for the all-electric Nissan Leaf, but the state’s generous tax credit is also coming under legislative scrutiny.

The state legislature is grappling with how to fund what is said to be a $1.5 billion shortfall in road infrastructure and electric vehicles are said to be part of the issue of declining gas tax revenues. A fee for electric vehicle registration may be part of the funding “solution.”

The next session of the Georgia legislature kicks off in 2015 with a reelected Governor Nathan Deal who is certain to continue his concentration on job creation and attraction. But electric vehicle and ride-sharing services, as well as a vigorous debate on transportation funding may prove to be challenges for the General Assembly.