Yes, but that's the first layer. The second layer is "Why would we care about undercutting local dealers"? And there are good reasons to avoid undercutting, not just greed, as is often the case.
They were merely well organized and. connected to state legislatures. It's just regulatory capture.
In my view if the local dealers will go to hell in a hand basket I won’t shed a tear. Michael’s Subaru of Bellevue couldn’t tighten some gasket under the car and my car was leaking oil after the oil change. When I took the car to the dealership they said it was because of my car being too old (older Subarus have indeed a problem with oil leaks). The guy behind the counter looked like he had anger management problems with my request to take another look. So yeah, if Amazon will put these dealerships out of business - good riddance.