Given today’s high gas prices, many car shoppers are turning their attention to hybrids and other fuel-efficient vehicles. Electric cars like those built by Tesla [NASDQ:TSLA] could be attractive to better-off buyers, but Tesla is facing some legal problems that may slow the selling process.

Automotive News reports that dealer networks and government regulators across the U.S. have begun to question Tesla’s sales techniques. And in several cases, they’ve threatened legal action to stop the start-up.

A new paradigm for auto sales

According to the National Automobile Dealers Association, 48 states have franchise laws that forbid or restrict the ability of automakers to sell vehicles directly to the public. That’s why dealerships tend to be independently owned and operated. Tesla showrooms, on the other hand, are owned by Tesla itself.

However, Tesla says that the majority of its showrooms — designed by George Blankenship, the man behind Apple’s outrageously successful chain of retail shops — don’t actually conduct sales; they simply share information about Tesla vehicles. When it’s time to seal the deal, Tesla staff point prospective shoppers to the automaker’s website, where they can customize and reserve their vehicle.

Other dealers aren’t buying it. They insist that even though Tesla’s showroom staff don’t technically sell vehicles on site, they do everything else that a traditional dealership would do. In short, they argue that by facilitating the sales process, Tesla showrooms are essentially conducting sales.

To date, questions about the legality of Tesla showrooms have arisen in four states: Illinois, Massachusetts, New York, and Oregon. Because franchise laws vary from state to state, each case is a bit different: some complaints have been brought by dealer associations, and in Illinois, the challenge was lodged by the Secretary of State. Tesla says that it is doing everything it can to comply with each state’s regulations.

Tesla currently maintains 17 showrooms in 10 states and the District of Columbia, but it’s set to open another six this fall. As Tesla expands operations and its reputation grows, we’d expect to see many, many more challenges to its business model down the line.

Will Tesla eventually shift to a conventional model of independently owned dealerships? Or will it bring about a change in the way that state laws are written — laws generally written decades ago, when there was far less competition in the marketplace and states wanted to put big automakers on more equal footing with smaller ones?

And more importantly, will Tesla’s unusual sales paradigm — which has recently been copied, in part, by Audi — change the way that automakers interact with customers?

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This story originally appeared at The Car Connection.

Gas prices are soaring. Parking is pricey. The economy is recovering, but still shaky. Add all that up, and you’d expect small cars to be fairly popular in the U.S.

And you’d be right. In fact, small cars are on track to reach a market share not seen since Bill Clinton’s first inauguration.

According to the Wall Street Journal, sales of compacts and subcompacts have surged by a whopping 49.9% over the past year. In the first nine months of 2012, dealers moved 2,099,090 of them – 240,288 in September alone.

By contrast, midsize vehicles are up just 15.8% for the year, large SUVs are down 29.6%, and large cars are down a staggering 79.4%.

As AutoNews notes, small cars now represent 19.3% of new vehicles sold to American shoppers. Compacts and subcompacts haven’t represented such a huge portion of the U.S. market since 1993, when they hit 20.5%.

Why is small such big news?

The reasons for America’s fascination with small rides are numerous and varied. While some of the trend seems driven by fluctuating economic conditions, in other cases, it may stem from more permanent demographic shifts. Here are a few key factors:

High gas prices: It’s no secret that gas is expensive. Today, the average price for a gallon of regular unleaded is $3.82 — 42 cents higher than it was at this time last year. And if you live in California, the situation is even worse. Small cars are perceived to earn better gas mileage than their larger siblings, which helps explains the public’s new-found interest in them. (Note: this perception isn’t entirely accurate, since the midsize Toyota Prius is more fuel-efficient than many smaller rides.)

Exciting new models: Fuel economy would mean nothing to shoppers if today’s gas-sippers weren’t attractive. Thankfully, automakers have given car buyers a range of small cars to peruse, many of which feature great design and fashion-forward technology. Just think of the MINI Cooper, the Dodge Dart, the Chevrolet Spark, and the Ford Focus, the latter of which has seen sales surge 91% in the past 12 months.

Our urban lifestyles: The trend in America — and in much of the world — is for individuals and families to relocate to cities. Even people who’ve stayed in one place have awakened to find their formerly rural neighborhoods overtaken by suburban sprawl. Keeping a big vehicle in urban environments can be far tougher than managing a smaller one.

Cost-effectiveness: The U.S. economy seems to be on the rebound, but until the rest of the world gets its act together (looking at you, Europe), things will remain touch-and-go. Small cars tend to be cheaper than larger ones, and their cost of ownership often is, too.

Eco-friendly attitudes: America has been on an extended “green” kick for several years, and it shows no signs of abating. Even though small cars aren’t necessarily greener than large ones, the public often thinks that they are, which has helped turn the heads of today’s shoppers.

Small ain’t what it used to be: Once upon a time, the compacts and subcompacts that littered America’s highways and byways were tiny econoboxes, limited in space and creature comforts. The legal definitions haven’t changed much over time: for decades, the EPA has classed cars by interior volume, with compacts having 100 – 110 cubic feet, subcompacts having 85 – 100 cubic feet, and minicompacts less than 85 cubic feet. However, through ingenious use of materials and the addition of gadgets like high-tech infotainment systems, today’s small cars don’t seem quite as small as their predecessors.

Are you planning to purchase a new vehicle anytime soon? Is a small car on your short list? Drop us a line, or leave us a note in the comments below.

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This story originally appeared at The Car Connection.

The answer depends, for the most part, on how far away you are from the traffic signal when it first turns yellow. But it’s not as simple as that. Some drivers have slower reaction time than others, particularly older drivers. The weather and road conditions also have a bearing – or should – on your actions.

To get a clearer picture of driver behavior when dealing with yellow lights, we spoke with Hesham Rakha, director for Sustainable Mobility at Virginia Tech Transportation Institute (VTTI). Not coincidentally, Rakha is deeply involved in research to come up with new ways of designing yellow light times to account for the differences in drivers, as reported in a recent story in Claims Journal.

“Every driver, depending on their characteristics, actually needs a different yellow time than another driver,” said Rakha. “What we found in the field was the drivers were typically more aggressive in their deceleration than what is used in the design. However, depending on the age of the driver, the gender, also the weather conditions, those strategies will change.”

Rakha said that the current procedures for determining yellow light time use a fixed perception-reaction time of one second and a deceleration level of 3 meters per second squared. But research by Rakha and his colleagues found is that drivers are different. “If you spend a longer time perceiving and reacting, in order to overcome that you typically press on your brakes harder in order to compensate for the time you lost in reacting to the change,” Rakha explained.

The dilemma zone

Based on field results, Rakha said that no matter how well yellow times are designed, there is the possibility that someone could be caught in the dilemma zone, also called the decision zone.

“When you’re very far away from the traffic light the decision is easy. It is also very easy when you’re close to the traffic light and it changes. When you’re close you know you should run, continue through the light at your current speed, because there is no way you could stop. And when you’re very far away, you know you could stop. There’s no decision involved.

“The dilemma zone comes when you do not have a correct decision to make,” Rakha said. “If you tried to stop and with the parameters the lights were designed with – a one second perception-reaction and 3 meters per second squared deceleration rate–you will not be able to stop before the light changes and, if you’re trying to run, you will not be able to run before it changes to red. You have no correct decision to make, unless you can pull yourself out of that dilemma zone, either by reacting quicker or being more aggressive on the brake pedal.”

An unfortunate consequence off suddenly slamming on the brakes is a possible rear end collision. If you’re traveling faster than the speed limit, or if you spend more time distracted and take longer to react, you can actually be caught in the dilemma zone.

Designing longer yellow times

Studies of driver reaction times and vehicle deceleration rates used in determining appropriate yellow and all-red change intervals were conducted more than 25 years ago (although some recent studies have occurred during the past couple of years).  Additional studies are required to validate whether these reaction times and deceleration rates are still appropriate.

Rakha and his colleagues at VTTI came up with yellow times to account for various driver populations in extensive testing on the Virginia Department of Transportation’s Virginia Smart Road. A certain amount in yellow time that will result in 95 percent of the drivers not being caught in the dilemma zone and only potentially 5 percent being caught in the dilemma zone. For a result of 99 percent not being caught in the dilemma zone, a longer yellow time is required.

“If you’re designing the yellow times in Florida, where the majority of the drivers are older, you have to come up with a different yellow time than if you’re designing yellow times for here in Blacksburg, Virginia where the population is younger, and the majority of the population is students,” said Rakha.

Four more potential solutions

Although none of the possible solutions Rakha mentioned are likely to occur anytime soon, there are several distinct ones that could provide drivers with advance warning, more time to react, and better decision-making options.

1.  In-car warning systems

“Potentially you could have a warning in your vehicle that basically recognizes your age, gender, and can warn you before the yellow light comes on, to give you that extra time you need to take your action,” Rakha said.

In a paper sent to the Department of Transportation, Rakha proposed that automakers could possibly create such a system. But it would have to be more than just a forward-collision warning system. It would have to be in communication with the traffic signal controller, vehicle-to-infrastructure (V2I) and infrastructure-to-vehicle (I2V).

2.  V2I and I2V

“The infrastructure would inform the vehicle that the light will be turning yellow in, say 10 seconds,” said Rakha. “When you’re approaching the traffic light, you’re going to get some kind of communication, and then the vehicle can react. It could be some kind of in-car driver display, providing a countdown to yellow to alert the driver to start slowing down, or giving the driver the actual decision by automatically applying the brakes. Of course, sensors would be required to measure wet and dry conditions.”

According to Rakha, his group’s proposed approach could be integrated within the Connected Vehicle Research program, which can gather information on the driver, the subject vehicle, and surrounding traffic conditions to execute safe and customizable change interval in-vehicle warnings.

3.  Flashing yellow

Drivers approaching a high-speed intersection need a much longer yellow. A flashing yellow informs the driver earlier that it’s going to be yellow so that he can make the decision. “If I’m upstream of this, I should stop. If I’ve passed that flashing yellow, then I should run,” said Rakha.

This is something Rakha’s group suggested in their report to the DOT. Germany, for example, has a flashing yellow on the traffic lights a couple of seconds before the yellow comes on.

4.  Yellow line on roadway

“We also proposed to the DOT to draw a yellow line on the roadway,” Rakha said. “If the traffic signal turns yellow when you’re upstream of that line, you should stop. If you’re downstream of that line, you should continue at present speed through the intersection. You should be able to proceed without running a red light.”

But there are other potential benefits, such as minimizing emissions and vehicle fuel consumption. “Why should we incur an extra stop which consumes more fuel and emits more emissions?” Rakha asked.  “If you stop when you weren’t supposed to stop, you’ll stop very aggressively, which could cause an accident, a rear-end crash for someone behind you. The fact that you’re stopping does not mean that you’re a better driver. It could mean that you’re more dangerous.”

When will any of this take place? Rakha said that the DOT requires a rigorous process before changing their procedures for designing yellow interval durations. This is typically mandated federally from the Institute for Transportation Engineers (ITE) or AASHTO.

Rakha added that he plans to approach the DOT to see if his group can gather additional data to design specific yellow timings and test them in the field for real drivers.

Our take

With development occurring now on V-to-I and I-to-V communication systems, perhaps the horizon for longer yellow times isn’t all that far off. On the other hand, when and if self-driving cars become a reality, the need may be moot – at least on certain roadways.

In the meantime, we can perhaps draw our own conclusions from Rakha’s research about driver reaction times, approach speed and distance from a signalized intersection, in making a personal decision whether to stop or go. While Rakha emphasized he cannot recommend stop or go, what he can do is recommend to traffic engineers ways that they can come up with a better plan for yellow times.

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This story originally appeared at The Car Connection.

As a German sports car fan, I had my doubts about raw American power. Peter let me drive the Shelby GT500 around the streets of Manhattan (particularly down a strip of highway that runs along Manhattan’s West Side) and on the long straights at Jones Beach in Long Island. I was completely taken with the car. It’s power, its push, was just incredible, and it made me giggle like a little school girl. I loved it.

One of my favorite moments with the car was during that trip down the West Side Highway. A huge man in a giant 18-wheeler pulled up next to us, and motioned for Peter to roll down the window.

He leaned out and in a thick Bronx accent said “So you think she can handle all that power?”

Peter glanced at me, and gave a wry smile. “Uh yeah. She totally can.”

At which point, the light turned green, and we pulled away, a giant smile on my face.

Click to see the Shelby GT500 in action.

From urban dwellers to long-distance commuters, more and more Americans are opting to leave the driving to others – and taking advantage of the growing number of ride-sharing apps available today.

The potential audience is huge. Census survey data shows the percentage of people car-pooling has remained around 10 percent for several years. Some five percent of commuters use public transportation and a whopping 76 percent drive alone. But convincing people to give up a car and share a ride with a stranger? With the number of ride-sharing apps popping up recently, it could just be that the time is right.

While some are limited to certain cities or geographic areas, other startups have intentions of going national, while yet still more are already doing business nationwide. The basic principle is the same: passengers looking for a ride use the app to post their request and the app searches for drivers in the vicinity willing to provide rides. Security concerns about riding with a stranger are handled by thorough prescreening. Cost of the ride varies, with some fares a voluntary donation at a recommended amount. User ratings help keep things on an even keel. A low rating of a passenger may mean drivers will refuse that person’s ride request in the future.

Here’s a round-up of a few of the larger ride-sharing operations currently available.

SideCar

San Francisco-based SideCar launched its on-demand ride-sharing app at the end of June, available for iPhone and Android devices across the U.S. SideCar vets drivers with a background check, proof of valid insurance, proof of driver’s license and proof of registration. Rides are also tracked using GPS. As for passengers, they need to register with a valid credit card.

Zimride

Passengers in need of a local or long-distance ride can hook up with Zimride, now serving San Francisco, Los Angeles, Sacramento, Tahoe and Las Vegas. The app uses Facebook to enable real connections: setting up a profile, booking a ride or posting a ride. What’s it cost? Recent postings on the site included $40 per passenger from Los Angeles to San Francisco, $35 per person from Santa Barbara to Berkeley, and $40 per person from Oakland to Los Angeles.

Lyft

From Zimride, Lyft is an on-demand ride-sharing app competitive with SideCar. Lyft screens drivers, runs criminal background checks, and conducts a phone interview followed by an in-person interview with prospective drivers. Lyft rider fares are voluntary, based on a community average. Like SideCar, Lyft has a rating system for drivers and passengers. Drivers and passengers authenticate using Facebook. Currently, Lyft is only available in San Francisco using iPhone.

Avego

Using the Avego iPhone app, drivers can offer their unused seats to other people in real-time. The app combines GPS-enabled real-time ride-matching with fully automated payment transaction management, safety features, real-time passenger information, and commute reporting. At the end of the journey, Avego automatically charges the rider a fair and predetermined price for the trip, based on a per-mile default rate. Users (driver and passenger) rate each other using 1 to 5 stars. If either rates the other with 1 star, they will never again be matched together. See our previous coverage of the Avego ride-sharing app or check out the video below for more details.

Weeels

As previously reported, Weeels is limited to taxi-takers in the New York City area only, and the app isn’t as user-friendly as some others. Still, if you can put up with the hassle of creating a personal profile and don’t mind fiddling with inputting addresses for pickup when time is of the essence – and you’re in New York City – Weeels is yet another potentially workable ride-sharing solution.

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This story originally appeared at The Car Connection.

A month ago, Americans paid an average of $3.69 for a gallon of unleaded regular gasoline. Today, we’re paying $3.84.

What gives? Isn’t this the time of year when gas prices are supposed to drop — when companies stop manufacturing expensive summer-blend fuel and transition to more affordable winter blend?

Ordinarily, yes, but this year, we’ve hit a couple of speed bumps.

The biggest of those bumps was Hurricane Isaac. On the Saffir-Simpson scale, Isaac was a fairly minor storm, far less powerful than monster hurricanes like Katrina or — for those of a certain age — Camille.

However, Isaac did its best to disrupt oil production in the Gulf of Mexico, which made analysts worry.

And that’s where the problem lies, because ultimately, analysts’ fears and enthusiasm hold far more sway over oil and gas prices than they should. After all, the Gulf of Mexico isn’t the only place where oil is extracted, and Southern states like Louisiana and Mississippi aren’t the only places where it’s refined. But when analysts see a giant, swirling, meteorological mass in the Gulf, they often panic, and the rest of us pay for it at the pump.

It didn’t help that Isaac hit just before Labor Day weekend. Shutting down oil rigs and refineries during a major travel holiday caused fuel prices to climb further than they might’ve if Issac had struck a week later.

The good news is that many of the Gulf’s rigs and refineries are up and running again, which should calm analysts’ nerves and bring gas prices down. The first to see relief will be those who live closest to the refineries in the Deep South. Folks in the far West, northern Midwest, and New England, will have to wait a bit longer.

But we’re not entirely out of the woods yet. The earliest on-sale date for winter-blend gasoline is this Saturday, September 15, but temperatures have been remarkably high this summer, breaking all-time records in many places. (Wisconsin got the worst of it, followed by Iowa, Missouri, Indiana, and Minnesota.) Though some areas have seen the mercury dip in recent days, high temps may linger in other parts of the U.S., which could delay the roll-out of winter blend.

We can also blame Isaac for that delay: fuel companies produced a lot of summer-blend gasoline, and Isaac disrupted their ability to distribute it. Until it’s used up, most companies won’t make the switch to winter-blend gasoline. (Unlike summer-blend, which has to be on sale everywhere by June 1, it doesn’t appear that winter-blend has a mandatory on-sale date.)

Have gas prices begun to slip in your neck of the woods yet? Drop us a line, or leave a note in the comments below.

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 This story originally appeared at The Car Connection.

Here’s the link… Wicked’s Trade Bait Page

Enjoy homies…..

ROSEVILLE, Minn. (WCCO) – We’ve seen the slickly produced car commercials that laud the rebirth of Detroit’s automakers. But it’s in the showrooms of dealers like Jerry Golinvaux’s Roseville Chrysler Dodge Jeep, where sales numbers capture the real story.

“We’ve had an outstanding August,” Golinvaux said. “Sales are up 34 percent, and for the year we’re up 22 percent.”

Together, the big three automakers are reporting strong sales in the month of August. On Tuesday, General Motors said its sales were up 10 percent. Ford posted a 13 percent gain and Chrysler led the pack with a monthly increase of 14 percent.

On a Tuesday afternoon at the Roseville Chrysler dealership, the showroom was buzzing with interested customers. Dwight Robinson was among them. And he was in a buying mood.

“Mine was an ’03, so it’s about time for another one,” Robinson said.

Nationally, sales numbers are the best in years, due in large part to pent-up demand, an improving economy and aging wheels on our roads.

“The average age of vehicles, cars and trucks on the road today is 11 years old,” Golinvaux said. “And in 32 years of doing business, I can never remember vehicles being that old on the road.”

The popular “Cash for Clunkers” program took a lot of quality used vehicles out of the market. So prices are up and there are fewer good used vehicles to choose from.

As for the demand for new vehicles, it’s not just fuel efficient models that are selling. Robinson is getting a new Dodge Ram truck.

“Because I blew the engine in the other one, so I have to get another one,” Robinson said. “I always wanted to buy a brand new truck.”

It’s good news to an industry that weathered the worst economic storm in recent memory.

“It’s really good and I bless myself every day,” Golinvaux said.

The final ruling, originally due two weeks ago but delayed because of continued political wrangling, will require average fuel economy of all new cars and trucks sold in the U.S. to reach 54.5 mpg by 2025.

Speaking at a press conference earlier today, U.S. Transportation Secretary Ray LaHood proudly announced the new standards.

“Today is a monumental day for the U.S. people,” he said at a White House Conference moments ago. “This will cut oil consumption by 12 billion barrels,” he explained.

“President Obama understands that when consumers have the option to save fuel, everyone wins,” he continued. “Under today’s standards, Americans will have the choice of buying the kind of vehicle they want. Everyone wins when we reduce fuel use and cut carbon emissions.”

“We’ll lead the world in building the cars and trucks of the future,” said Lisa P. Jackson, Environmental Protection Agency Administrator. “These new standards ensure that the progress we’ve seen so far will continue for years to come,“ she added.

Cars built under the new standards will emit half as much greenhouse gas as current models, Jackson explained, reducing greenhouse gas emissions by a massive 6 billion metric tons.

Although the new standards will increase the price of new cars by around $1800 by 2025, current analysis suggests that the improvement in fuel economy could net U.S. drivers an average $8,000 in gasoline savings per car when compared with a similar model from 2010.

This equates to a nationwide saving by 2025 equivalent of $1.7 trillion of gasoline per year.

“We commend the Obama administration, the auto industry, and environmental organizations for working together to bring about this historic leap in fuel efficiency.  The new standard of 54.5 mpg by 2025 for cars and light trucks will effectively double fuel efficiency and provide many benefits to drivers and the country” said Phyllis Cuttino, Director of the Clean Energy Program at Pew Environment Group, a non-profit group that works to promote clean energy economies and ecological practices through pragmatic, science-based policies.

“Our nation will be more secure, our environment will be cleaner, and consumers will have more money in their pockets as a result of the new rule,” she continued.

Under the new ruling, an estimated 570,000 jobs could be created in the U.S auto industry, as automakers strive to find new ways to build ever-efficient cars.

“This helps drive innovation,” said Jackson. “Innovation is the sweet spot where our economic and environmental needs meet.”

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This story originally appeared at Green Car Reports.

The insurance powerhouse has just released its eighth annual “Allstate America’s Best Drivers Report”, which uses claims data to rank America’s 200 (technically, 193) largest cities in terms of residents’ car collision frequency. Although the data comes solely from Allstate customers, the company writes about 10% of all U.S. auto policies, which would seem to give a reasonably accurate picture for the nation as a whole.

Top 10 Safest Drivers In America

Allstate says that Americans tend to be involved in a collision once every 10 years. Not surprisingly, the cities that scored better than that average tended to be smaller ones. Here are the top five, in reverse order:

10.  Houston, Texas (7.9 years between accidents)
9.  Chicago, Illinois (7.9 years between accidents)
8.  San Antonio, Texas (8.3 years between accidents)
7.  San Diego, California (8.8 years between accidents)
6.  Phoenix, Arizona (10.2 years between accidents)
5.  Lincoln, Nebraska (12.4 years between accidents)
4.  Madison, Wisconsin (13 years between accidents)
3.  Fort Collins, Colorado (13.6 years between accidents)
2.  Boise, Idaho (13.8 years between accidents)
1.  Sioux Falls, South Dakota (13.8 years between accidents)

Top 10 Unsafest Drivers In America

But of course, what we all want to know is: where do the worst drivers live? Allstate is too nice to tell us that in its press release, but we found it in the accompanying data:

10.  Alexandria, Virginia (6.4 years between accidents)
9.  San Francisco, California (6.4 years between accidents)
8.  Jersey City, New Jersey (6.4 years between accidents)
7.  Hartford, Connecticut (6.3 years between accidents)
6.  Philadelphia, Pennsylvania (6.2 years between accidents)
5.  Providence, Rhode Island (6 years between accidents)
4.  Newark, New Jersey (5.9 years between accidents)
3.  Glendale, California (5.5 years between accidents)
2.  Baltimore, Maryland (5.3 years between accidents)
1.  Washington, D.C. (4.8 years between accidents)

Did your city get a fair shake? Feel free to grouse about Allstate’s findings in the comments section below.

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This story originally appeared at The Car Connection.

Bidding went as high as $6.4 million but that wasn’t high enough to meet the seller’s predetermined “reserve” price, so this Duesenberg didn’t sell at Pebble Beach in 2012.

It does have a fascinating history repleat with love, intrigue and a very Hollywood ending.

For the complete story visit CNNMoney.

Peter Valdes-Dapena and I got up close and personal with the car–and it was phenomenal.

Not only did Tesla Motors obtain a pre-built facility — complete with the essential machinery it needed to build its 2012 Model S Sedan — at the heavily-discounted fire-sale price of $59 million, but it helped offer skilled jobs to those who had previously been made redundant when the factory closed under General Motors’ bankruptcy.

But now a developer in New Mexico, where Tesla had originally planned to build a factory, is suing the electric automaker for picking California over New Mexico.

According to Gigaom, the claimant in the case, Rio Real Estate Investment Opportunities, filed a law suit back in May against Tesla for fraud, breach of contract, negligent misrepresentation and negotiating in bad faith.

The developer claims it entered into a binding development agreement with Tesla in February 2007 to build a new factory in New Mexico that Tesla would then lease from it for $1.35 million a year for ten years, plus a 2 percent annual increase.

In early 2008, the deal became public when New Mexico Governor Bill Richardson publicly announced Tesla had chosen the Cactus State as the home of Model S manufacturing.

Less than six months later however, the then-Californian Governor Arnold Schwarzenegger leaked the news that Tesla had decided to build the Model S in California, scuppering New Mexico’s hopes of being home to Tesla.

In the official court filing with the New Mexico State Court, Rio Real Estate Investment Opportunities claims it spent money on creating environmental reports, obtaining relevant government permits, and drawing up engineering designs for the site as a consequence of signing the 2007 contract with Tesla.

When Tesla changed its mind about where to site its Model S factory, Rio Real Estate Investment Opportunities said it suffered financially.

Tesla Motors does not comment on pending litigation, as it has consistently told reporters. It has also sought to move the trail from New Mexico State Court to Federal Court. The first hearing is on September 18, in Albuquerque, New Mexico.

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This story originally appeared at Green Car Reports.