GM Volt Forum banner

Crony Capitalism: Michigan to require all sales thru franchises

4589 Views 16 Replies 13 Participants Last post by  Ron C
Another midnight back-room politics deal aimed at "protecting the consumer". The bill awaiting the governor's sig would bar any car company from selling direct to consumer even if they never had any dealers. Hmmm, who would this law apply to? Of course, selling to a government agency is excepted (politicians don't like to be subject to their own laws).

Current law says only “dealers” are allowed to sell cars in Michigan; the amendment turns it into “franchised dealers.”

The law also bars Tesla from having a showroom or discussing the car with consumers in such a setting. For the consumer's protection of course.

It seems clear that the Automotive Dealers Association agrees with the mafia and Al Capone on the meaning of "protection".

http://www.forbes.com/sites/michelin...ng-cars-there/

http://www.statecolumn.com/2014/10/t...night-tactics/
1 - 17 of 17 Posts

· Registered
Joined
·
9,953 Posts
I wonder if GM CEO Mary Barra agrees or not to this new law. I expect her to be against it.

Tesla Motors has a way out: Change the name to Tesla Appliances, and call the Model S an “electric mobile appliance”, like if it was a vacuum cleaner or portable computer on 21-inch wheels. Then the law will have no effect.
 

· Registered
Joined
·
4,014 Posts
Home of the big 3, what did you expect!
 

· Administrator
Joined
·
23,437 Posts
Discussion Starter · #6 ·
"Car buyers prefer the Tesla buying experience. We can't compete with that. It needs to be outlawed to force buyers to use a franchise middleman." This is my take on what the Michigan Auto Dealers Association is actually saying. Both the Democrats and the Republicans voted for the amendment, though it's unclear if any knew the language had been altered at the last minute.

Now it's up to the governor. Will he veto this anti-consumer, anti-free market bill or will he stand firm on his campaign of promoting entrepreneurship and free market ideals?
 

· Registered
Joined
·
534 Posts
Not sure that's what's best for his state. I'm not even sure it's best for the Big Three as there have been rumors that one of them might buy Tesla when the time is right. The only group that would want to keep the Tesla model away is the dealers' association. If they have to legislate to protect themselves from manufacturers opening factory owned showrooms, then the Tesla model appeals to me even more.

How many discussions have there been here about franchised dealers unwilling to sell, service or even to know about Volts. Maybe factory owned dealerships from all car makers would be best for the customers and the manufacturers.
 

· Registered
Joined
·
5,194 Posts
It is absolutely OUTRAGEOUS that the Automotive Dealers Association thinks they can stop an automotive manufacturer from selling any way they want to.

This country is supposed to be about FREEDOM! Not supporting the mafia Dealers Associations.

This is the definition of ANTI-COMPETITIVE behavior and is exactly what the US department of commerce is supposed to PREVENT!
 

· Registered
Joined
·
626 Posts
So how does this have to do with Capitalism? I live in WA state run by democrats. I am not allowed to buy a warranty out of state. Same with CA, OR and NV all run by democrats. I can see where cronyism can be the issue but Capitalism?

Union cronyism is more like it
 

· Registered
Joined
·
450 Posts
So how does this have to do with Capitalism? I live in WA state run by democrats. I am not allowed to buy a warranty out of state. Same with CA, OR and NV all run by democrats. I can see where cronyism can be the issue but Capitalism?

Union cronyism is more like it
I think the situation fits Wikipedia's definition of crony capitalism.
 

· Registered
Joined
·
626 Posts
How is that law enforced?
I called two out of state warranty sales dealers and they told me it was illegal for them to sell them to me in WA and I was required to purchase within my state. Finally one told me that they could not register and send the paperwork to my WA address so I tried using relatives in 3 other surrounding states and they were still not able to sell it to me in those states. It wasn't until I used a relatives address 3000 miles away that I finally got the sale. Apparently they can be fined for violating these laws or face some sort of consequences. So ya I had to lie and cheat in order to get a bargain. That makes me a criminal I guess.
 

· Registered
Joined
·
626 Posts
I think the situation fits Wikipedia's definition of crony capitalism.

Ok so it doesn't really have anything to do with Capitalism being a bad thing, I'm ok with it then :) Anyone can take something good and misuse it in a bad way. We're all capitalists, we go to work and earn more than we need to live. If we didn't earn more than we need we would not be able to afford our Volts. Somehow I thought capitalism had something to do with the "free market" nothing seems free market when it comes to restricting tesla from selling direct.
 

· Registered
Joined
·
626 Posts
This doesn't sound any different than OR laws when it comes to gas stations. You are not allowed to pump your own gas. The station owner by law is forced to hire employees to dispense the fuel. I got cussed out for just putting the nozzle into the car, big no no. Is that crony capitalism or social capitalism? The station owner must pass these expense onto the customer.
 

· Registered
Joined
·
1,054 Posts
I'm not even sure it's best for the Big Three as there have been rumors that one of them might buy Tesla when the time is right.
That ship has sailed. The market cap for TSLA (today, 10/20/2014) is 28.8B. They'd have to offer significantly more than that for the vote to pass. Which one is in any position to do that?
 
1 - 17 of 17 Posts
This is an older thread, you may not receive a response, and could be reviving an old thread. Please consider creating a new thread.
Top