Auto Dealers Try Charm: Why Tesla Direct Sales Hurt Buyers, They Say (Video) Page 2

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Tesla Store Los Angeles [photo: Misha Bruk / MBH Architects]

Tesla Store Los Angeles [photo: Misha Bruk / MBH Architects]

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That one, unfortunately, may not be shared by 1,000 or more Fisker buyers--many of whose dealers took down their signs and closed up shop mere months after selling them their $106,000 range-extended electric luxury sedan.

ALSO SEE: One Former Fisker Dealer Vanishes Into History (Photos)

And ask your local Saab or Suzuki owner how good their service is--in the case of Suzuki, only two years after it announced it would exit the U.S. market.

Former Fisker of Bellevue, Washington, dealership, closed as of July 2013 [photo: Brian Henderson]

Former Fisker of Bellevue, Washington, dealership, closed as of July 2013 [photo: Brian Henderson]

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Local jobs and tax revenue

The fourth point is that dealerships generate lots of local jobs and, consequently, tax revenue.

The video doesn't explain why service managers, technicians, car detailers, drivers, and all the rest wouldn't simply be employed at company-owned stores.

(The implied concern over support for community activities like fire departments, softball teams, charity drives, and other local events is likely quite valid indeed.)

Finally, the video winds up by saying dealers just make the car-buying process more convenient--taking on the "complex process" of arranging loans, managing legal paperwork, and getting the car taxed, registered, and titled for delivery.

We'd love to see a test of the total time required to buy a Tesla Model S online and arrange financing versus the process for doing the same at a local dealership.

Money and car keys

Money and car keys

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Simple language changes

The last four years of skirmishes between Tesla's online sales model and dealer lobbying in state legislatures has produced mixed results.

In some states--New Jersey being the latest--bills favorable to auto dealers, sometimes tacked on as amendments to bills addressing entirely unrelated issues, have been publicized by Tesla or its advocates.

That has often provided a level of transparency and awareness to such legislation that it may not have had.

Given that the bills often address the arcane state rules under which franchises are granted and administered, banning Tesla from a state can be as simple as removing a few words from one or two sentences of legislative legalese.

As the Colorado Auto Dealers Association wrote in its 2010 End of Session report:

An existing provision in Colorado law already prevented a manufacturer from operating a dealership so long as they were not [sic] franchised dealerships. This statue [sic] narrows provision [sic] so a manufacturer that has any dealerships in Colorado, whether franchised or not, is prohibited from operating a dealership.

In other words, the original intent of such laws--to protect franchised dealers who had invested in their businesses over many years or decades from being undercut by the automakers they had to rely on for cars--had been considerably broadened to forbid any carmaker to sell a vehicle to a retail buyer under any circumstances.



Outlook varied

Most Americans today remain seemingly ignorant of the fact that in most states, it's illegal for GM or Toyota to sell them a car. But dealers' anti-Tesla efforts have clearly raised at least some awareness of the issue.

So perhaps NADA's PR campaign may be just the first step of an escalating battle for the hearts and minds of American car buyers.

And depending on how fond you are of your local dealer--more specifically, how well you were treated the last time you bought a car or had it serviced--your reactions to the video may vary radically from those of your neighbor.

Which is why the outlook remains uncertain in the state-by-state battle, and likely will continue that way for some time yet.

Meanwhile, at least some buyers in states that ban Tesla direct sales will continue to find workarounds to get the luxury electric cars.

Dealer forecast: Mixed, with some clouds on the horizon.


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