[bro1999]

A bill that would give an exception to Tesla to allow it to sell directly to customers in CT advanced the Finance Committee, but faces stiff opposition in the House of Representatives. Proponents of the bill say the franchise laws are outdated and need to be updated (especially since CT is losing sales to other states), but the critics argue that Tesla could start selling cars tomorrow…if they played by the rules like all other manufacturers and sold through a franchised dealership

http://www.ctpost.com/local/article/Tax-panel-narrowly-approves-in-state-Tesla-sales-11130420.php

Question: what is preventing Tesla from setting up some “Elon and Friends Company” in these states that bar direct sales to customers and sell Teslas through an Elon and Friends-run dealership? Seems instead of waging legal war in each state that bars direct sales 1 by 1, they could just go through the motions and set up a dealership in name that is really just a Tesla showroom. What am I missing?

 

[Steverino]

The franchise laws were setup to protect existing dealers against the auto manufacturer being capricious. Tesla has never had dealers and should not be required to sell through one. If Tesla wants to sell direct and people want to buy direct from Tesla, they should be allowed to. Tesla should not be required to jump through a dealer-imposed hoop to do business.

 

[bro1999]

The franchise laws were setup to protect existing dealers against the auto manufacturer being capricious. Tesla has never had dealers and should not be required to sell through one. If Tesla wants to sell direct and people want to buy direct from Tesla, they should be allowed to. Tesla should not be required to jump through a dealer-imposed hoop to do business.

Yeah, but what's preventing Tesla from jumping through that hoop with an "independent" dealership run by "Elon and Friends Co"? Or "Tezla Motors" or something like that?

 

[wws]

Yeah, but what's preventing Tesla from jumping through that hoop with an "independent" dealership run by "Elon and Friends Co"? Or "Tezla Motors" or something like that?

It is a one-way street. My understanding is that under current law, if they were to start selling through dealers, they could never go back to a direct model.

 

[jegund]

My take on this argument is long term dealers would be better off breaking the chain now. Yeah, the incompetent ones would wither away, but those smart enough will thrive and provide services that consumers want and the manufacturers could not dream of providing. In a lot of locations I bet the manufacturers would become more dependent upon the dealers for services too.
What if dealers morphed into transportation consultants. They could have a solution for you for every transportation related need.

 

[firehawk72]

The franchise laws were setup to protect existing dealers against the auto manufacturer being capricious. Tesla has never had dealers and should not be required to sell through one. If Tesla wants to sell direct and people want to buy direct from Tesla, they should be allowed to. Tesla should not be required to jump through a dealer-imposed hoop to do business.

I really have not followed this in great detail, so my impressions here could be off base. Based on my limited knowledge of this subject, it is more of a concern to allow Tesla to operate this way because of the Chinese market. The Chinese market could operate the same way and sell here in the USA if Tesla is allowed to do so. If that is true, and I stress if true, we should just treat the Chinese companies like they treat us

 

[srmarti]

So if Tesla can do direct sales maybe GM, Ford, etc. should be allowed to as well. Maybe it would encourage dealerships to compete and earn the customer's business.


They noted it's a luxury car. What happens when the Tesla starts selling mainstream priced cars?

 

[obermd]

The franchise laws were setup to protect existing dealers against the auto manufacturer being capricious. Tesla has never had dealers and should not be required to sell through one. If Tesla wants to sell direct and people want to buy direct from Tesla, they should be allowed to. Tesla should not be required to jump through a dealer-imposed hoop to do business.

While the above is true it's also a fact that the franchise laws shield bad dealerships from their actions. There are so many bad Chevrolet dealerships that GM really needs some way to cut the ties to them and focus on creating better dealerships. The problem is that for many people, if they see Chevrolet on the dealership they think the crappy service and dealership created problems are a reflection on GM and not the dealership.

Hmm, maybe that's what GM needs to do - if dealerships are unable to properly take care of Chevy owners, then Federal trademark infringement lawsuits to force those dealerships to remove the Chevrolet name from their business. This would bypass the state level franchise laws.