Chapter 1 traces the history of the franchise dealer model of car distribution, from the early wild west days of the internal combustion automobile to the political confrontations between Detroit’s Big Three and the “mom and pop” car dealers during the mid-twentieth century. The chapter examines the thinking of legendary management figures such as Henry Ford and Alfred P. Sloan, explains the dealer protection rationale behind state franchise dealer laws, and shows how the legacy car companies largely acquiesced in those laws until Tesla’s entry onto the scene.

The legacy Detroit manufacturers were between a rock and a hard place. Having just emerged from near-death experiences during the 2008–09 financial crisis, they now had to face the onslaught not only of EV technology that they had long resisted but also of a company that refused to play by the settled rules on how cars are sold and serviced. Led by General Motors (GM), the legacies decided that their best tactic was to stand with their dealers and argue that Tesla should be denied direct sales, which would not only prevent Tesla from getting ahead but could keep Tesla far behind. This “raising rivals’ costs” strategy ultimately backfired, as Tesla got the right to sell direct in most states, and the legacies missed the chance to get their own right to compete with Tesla on a level playing field.

Full powers is a document produced as evidence that the person named in it is authorised to represent their state in performing certain acts in relation to the conclusion of a treaty, in particular its signature. The production of full powers is a fundamental safeguard for other states that they are dealing with a person with the necessary authority. It should be distinguished from credentials which authorise a person to represent a state at an international conference, in an organisation, or in ordinary bilateral relations with another state. Full powers are not required for heads of state, heads of government and foreign ministers. Full powers may also be dispensed with by the states concerned if it appears from their practice or other circumstances that it was their intention to consider the person as representing the state for such purposes. A state may issue its permanent representative to an international organisation with general full powers, which gives authority for that person to sign treaties generally adopted within that organisation. The content and procedure for the issue of full powers is discussed.