When California-based electric automaker Coda Automotive announced it would be opening showrooms in shopping malls, you might have assumed each showroom would have some way of helping customers order its all-electric 2012 Sedan. 

You’d be wrong.  They won’t, according to Coda CEO Phil Murtaugh.

Instead, interested parties will have to make the trip from a Coda-owned “experience center” to whichever Coda appointed dealers exist locally. 

“Their purpose is to educate people on electric vehicles,” Murtaugh said. “We’re not pushing sales out of the centers.”

2011 Coda Sedan electric car, New York City, September 2010

2011 Coda Sedan electric car, New York City, September 2010

Instead, Murtaugh explained that customers would “come in with product specific questions and movement questions.” In other words, Coda says its experience centers are about education, not sales.

Originally, Coda had planned to sell its $37,250 Sedan through a network of company-owned retail stores in the same way that Tesla Motors sold its Roadster sports car and plans to sell its 2012 Model S sedan. 

But since Murtaugh became CEO of Coda in January 2011, the company has changed its retail strategy significantly. 

Coda hasn’t publicly said why, but we suspect it has something to do with automotive retail law in some states. 

In some areas, dealer organizations have lobbied at the state level to have laws passed that make it illegal for carmakers to sell directly to car buyers through automaker-owned stores. As a consequence, some states have passed laws that say auto sales must be transacted through an independently owned third party like a dealership, rather than via an automaker-owned store.

Note that this doesn’t apply to all states, which explains how Tesla has managed so far to sell all of its cars exclusively through its own showrooms and stores without using third-party dealers. 

Even Tesla has acknowledged this might have to change however, especially if it wants to make its cars available in every state. 

In the case of Coda however, we suspect there may be another reason for its decision: it’s cheaper that way.

Aside from the usual expenses associated with running a large business, dealerships require highly-trained maintenance staff, as well as a fully-equipped workshop. 

2011 Coda Sedan electric car, New York City, September 2010

2011 Coda Sedan electric car, New York City, September 2010

For an automaker selling just one car, that’s a huge outlay.

By contrast, Coda’s experience centers require less skilled staff, have lower running costs, and leave maintenance and sales worries to dealers who already have staff that can easily be trained on the car.

Better still, while Coda can charge dealers to train their mechanics on its car behind closed doors, its experience centers can ensure that curious passers-by get a good first-impression of the brand and its first car. 

So far, that model appears to have worked well for Fisker, whose Karma plug-in hybrid luxury sedan has been sold exclusively through franchised, multi-brand dealerships 

At the moment however, Coda’s search for dealers -- not to mention the fact that it only has two franchises signed so far -- hints that it might be quite some time before the 2012 Coda Sedan is a common sight outside of California. 


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