Tesla Increases Lobbying Efforts To Break Into Michigan

[William Maley]

Last year, the State of Michigan signed a bill that banned an automaker from doing direct sales. This meant an automaker like Tesla couldn't sell any of their vehicles in the state. The move was widely applauded by the likes of GM and the Michigan Automobile Dealers Association. Tesla wasn't impressed by this and since then has been working on trying to change this.

 

But it hasn't been going well. While the company has been trying to educate lawmakers and state officials, it seems everyone in the state doesn't want to bring up the debate.

 

“There doesn’t seem to be much interest from not only the dealers, but manufacturers like GM that want to continue to shut us out of the market entirely,” said Jim Chen, Tesla’s vice president of regulatory affairs to The Detroit News.

 

“We’re an American company that is building cars in the United States that is using over 55 Michigan suppliers — that is spending over $120 million in parts and components from Michigan suppliers to build American-made cars. Why shouldn’t we be allowed to sell in Michigan?” Chen went on to say.

 

Terry Burns, executive vice president of the Michigan Automobile Dealers Association says Tesla is welcomed to the state, but they have to go through dealers.

 

“They’re an automotive manufacturer, and the Michigan law says that manufacturers need to use dealers in order to sell vehicles. That’s Michigan law. We would welcome Tesla here. But we would think that as with all the other businesses that come into Michigan, they would want to follow the law,” said Burns.

 

Interestingly enough, the state senate introduced a bill back in April to allow direct sales of three-wheeled “autocycles” to consumers in Michigan. A key automaker who stands to benefit from this is Elio Motors. In response, the Federal Trade Commission (FTC) issued a statement that criticized the move.

 

"Automobile manufacturers have an economic incentive to respond to consumer preferences by choosing the most effective distribution method for their vehicle brands," FTC officials wrote.

 

Tesla plans to continue their lobbying efforts in the state.

 

“We have the majority of next year to lobby, discuss and debate the merits of what we think is a co-existence of our business model in the state of Michigan," said Will Nicholas, Tesla’s government relations manager.

 

Source: The Detroit News

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[David]

Someone is crying over spilled milk.

 

I do think those laws are very much out dated for requiring dealerships myself though.

[oldshurst442]

To be fair, it really is not crying over spilled milk more than it being sentencing Socrates to drink Hemlock because he was 'corrupting young minds'...

 

You do know what Socrates said in his final speech dont you?

Anyhoo, hopefully Telsa does not share the same fate as Socrates, however, Isee the same zealousness as with those Athenians as with these Michiganders...

[regfootball]

sure, let em sell their kit cars there!

[oldshurst442]

They're not anymore kit cars than anything else that comes from Michigan...

But...Ive gotten 2 warnings regarding my posting style regarding childish biases so Im just gonna leave my post at that...

[Suaviloquent]

I think Tesla, in interest of furthering sales, might just end up having dealerships.

 

It moves the trouble of dealing with short-term demand fluctuations- such as cyclical buy habits and what it does to inventory to the dealers.

 

But having just one price, and one price for all is very succulent...

[Robert Hall]

sure, let em sell their kit cars there!

Nothing 'kit car' about them...weird to think they aren't sold in some states.  I seem them daily on the streets here in Phoenix/Scottsdale, and the parking garage for my office tower has at least 4 of them, maybe more. 

Edited December 4, 2015 by Cubical-aka-Moltar

[Suaviloquent]

Uh..... 

 

Tesla would be the first automaker to have a kit car become MT's 2013 Car of the year and Consumer Report's Highest rated sedan ever (it's not longer a top pick...but highest rated tho).

 

Kit cars or not, built in a backyard garage or not, lacking absolute luxury or not, they have changed the game forever.

 

If anyone has a $100,000 or more burning hole in the pocket caused by buying an electric vehicle, you can be sure they bought a Tesla.

[Scout]

Last year, the State of Michigan signed a bill that banned an automaker from doing direct sales. This meant an automaker like Tesla couldn't sell any of their vehicles in the state. The move was widely applauded by the likes of GM and the Michigan Automobile Dealers Association. Tesla wasn't impressed by this and since then has been working on trying to change this.

 

So the UAW and traditional dealers are still scared.  

Edited December 4, 2015 by Scout

[hyperv6]

It is not that they are scared but the fact that they want a level playing field.

​The standing MFG's have been forced to work with the dealer system by law from the start. They have at times tried to challange this system and were stopped by the goverment.  Now that they are loaded with the dealers they can not shead them unless they want to go out and buy them out at a major expense.

​What they fear is not Tesla but China. If you kill the dealer network China could fload all sorts of retailers with cheap cars from overseas and not be stuck building a dealer network the others can not get rid of.

​Hell I China wanted to their MFG could just sell from Sams Club, Best Buys or whom ever they want.

 

Tesla makes lots of headlines and has made progress but they are still a blip on the radar. They have only sold around 90,000 sedans and and a handful of roadsters. The X model is still late and counting with what has been discribed as many complex systems that will cause them more grief than needed. The doors have been discribes as working with the speed of two arthric stage hands pulling up a curtain and the car will hold challanges even Toyoata would struggle with As for the 3 model it is no where close to being here. They sold themselves as an American car but now appear to be considering thje 3 for production in China even with space still open at their plant in Fremont. Cost I think Elon is finding going to be tougher to keep down than he expected.

 

Tesla I think will have advanced the EV cause well in the public eye but like many Silicone Valley makes they will have to change or they will vanish like many before.

 

It has been recomended by Merrill Lynch that they should consider becoming a suplier of EV systems and parts to the other brands and drop the cars. This would be a smart move as even like the Gold Rush of 49 it was the people who supplied the tools and provisions that made money not so much the gold Minners. I even Believe the Fremont name sake was one of them. As long as they build cars no one will buy their systems but as a supplier others who can not make their own would show much interest. Then dealers are not an issue for them.

 

I am not a Tesla deciple but I do want them to not fail. If they fail they could do a lot of damage to the EV models remaining as many people still do not understand or trust the models. This is a slow grow segment that was the Chicken or the Egg in getting started. Tesla spured the others into investing more as they showed that one could sell a more expensive EV sedan. This helped them invest knowing they could add models at a higher price and not lose their shirt on each one. That is where Tesla contibuted.  But with the potential of a very expensive X model with things that could be issues that did not need to be, Aslo a 3 model that will be every bit as late and possibly from China their future is still very much at risk. Someone like VW can  make a major mistake and survive someone like Tesla makes one mistake like a failed X model with issues and it could damage them beyond what they can survive.

​Also note why they struggled to get the X and 3 models going they still need to address the S model updates. They need more than software changes as a redesign should be done soon as the car is aging and more competitors are coming. They could become yesterdays news to those with $100K buring in their pockets.  

[David]

^ I agree with what you have stated Hyperv6, I also think Tesla should be a powertrain supplier. They could make more money and resolve the whole dealership issue.

[ccap41]

" “We’re an American company that is building cars in the United States that is using over 55 Michigan suppliers — that is spending over $120 million in parts and components from Michigan suppliers to build American-made cars. Why shouldn’t we be allowed to sell in Michigan?” Chen went on to say."

 

I thought this little line within the reading was pretty awesome.

 

While they are asking for a level playing field they also realize they're doing this to a company not yet profiting. It screams more "fear" that just wanting a level playing field at this point. Had Tesla been making tons of money and actually stealing sales from the D3 I could see it a little different. but at this point we're talking about a company that's relatively small being banned form one state because they decide to sell their vehicles differently than they do.

 

 

Hyper, you made very good points.

[Scout]

The bottom line is that it's about money.  The dealer laws were established in the early 1900's and are antiquated.  The Tesla model is cheaper, and the NADA is screaming it's not fair.  Perhaps not, but just because something has been so for a long time does not make it rite.  NADA is near the top of all time political donations, and dealers account for about 15 percent of all retail sales in the US.  So Musk has an uphill battle against an established way of doing things.  Not because one way is better than the other.  But because one side is dug in and crying about whats fair.  

[Suaviloquent]

The bottom line is that it's about money.  The dealer laws were established in the early 1900's and are antiquated.  The Tesla model is cheaper, and the NADA is screaming it's not fair.  Perhaps not, but just because something has been so for a long time does not make it rite.  NADA is near the top of all time political donations, and dealers account for about 15 percent of all retail sales in the US.  So Musk has an uphill battle against an established way of doing things.  Not because one way is better than the other.  But because one side is dug in and crying about whats fair.  

 

This.

 

Super bump.

[regfootball]

http://www.motortrend.com/news/tesla-drops-out-of-2016-detroit-auto-show/

 

Tesla pulls out of Detroit.  First step to irrelevance IMO

[oldshurst442]

Jaguar, Land Rover and Mini are pulling out from Detroit too...

 

(I cant post links with my tablet, but I assure you, it is for realz what Im sayin')

 

One could have the same assumption of Tesla going down the road of irrelevance along with Mini and quite possible Jaguar by pulling outta Detroit....but when Land Rover is also amongst that list, and Ive also heard rumours that other biggish names also question their presence in Detroit, it leads ME to believe that 'tis the Detroit auto show that is one step in the direction of irrelevance....

 

And Im sure many others feel the same way about Detroit' auto show and how Detroit may not be as important as it once used to be...so....Im sure Tesla is just fine in skipping Detroit...

[Guest Wings4Life(BANNED)]

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

[ocnblu]

Mr. Tesla's name is being sullied by this blowhard.  He needs to STFU.

[ccap41]

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

How is it fair to force HOW somebody sells their product? Why is making somebody build a dealer and pay people to sell their product fair?

You don't force any other industry to go through a "dealer network" so why does a car have to be different?

[Robert Hall]

The dealer franchise system is an antiquated artifact of the past.  The traditional automakers are applying pressure to force out an innovative upstart...nothing new...

[Guest Wings4Life(BANNED)]

Mr. Tesla's name is being sullied by this blowhard.  He needs to STFU.

 

You manage to sully Ford in nearly every post you make.

May I suggest the same.

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

How is it fair to force HOW somebody sells their product? Why is making somebody build a dealer and pay people to sell their product fair?

You don't force any other industry to go through a "dealer network" so why does a car have to be different?

 

 

 

Perhaps you missed it the first time I typed it, so I will bold font it for you.....

[ccap41]

Mr. Tesla's name is being sullied by this blowhard.  He needs to STFU.

 

You manage to sully Ford in nearly every post you make.

May I suggest the same.

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

How is it fair to force HOW somebody sells their product? Why is making somebody build a dealer and pay people to sell their product fair?

You don't force any other industry to go through a "dealer network" so why does a car have to be different?

 

 

Perhaps you missed it the first time I typed it, so I will bold font it for you.....

Maybe you didn't realize the question I asked.. What about that is actually fair? Just because those are the rules doesn't mean they are actually fair. That basically makes it impossible for a new automaker to join the battle.

IMO, I think they could retain the bull$h! dealer network thing but I think they could allow direct sales for small companies. Maybe put a cap on either sales or revenue/net income/profit that will only allow they to sell so many vehicles before needing to form a dealer network. This will allow a smaller company to start up with waaaay less necessary costs to get their feet under them.

[ocnblu]

 

Mr. Tesla's name is being sullied by this blowhard.  He needs to STFU.

 

You manage to sully Ford in nearly every post you make.

May I suggest the same.

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

How is it fair to force HOW somebody sells their product? Why is making somebody build a dealer and pay people to sell their product fair?

You don't force any other industry to go through a "dealer network" so why does a car have to be different?

 

 

 

Perhaps you missed it the first time I typed it, so I will bold font it for you.....

 

Sir, that is for your benefit, because you are so rabid and you cut and paste too many posts right off the PR machine.  Truth be told, I love all three domestic automakers, but I am not going to cut them slack if they eff up, imo.

[Guest Wings4Life(BANNED)]

 

 

Mr. Tesla's name is being sullied by this blowhard.  He needs to STFU.

 

You manage to sully Ford in nearly every post you make.

May I suggest the same.

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

How is it fair to force HOW somebody sells their product? Why is making somebody build a dealer and pay people to sell their product fair?

You don't force any other industry to go through a "dealer network" so why does a car have to be different?

 

 

 

Perhaps you missed it the first time I typed it, so I will bold font it for you.....

 

Sir, that is for your benefit, because you are so rabid and you cut and paste too many posts right off the PR machine.  Truth be told, I love all three domestic automakers, but I am not going to cut them slack if they eff up, imo.

 

 

I can say the same exact thing.

 

Sir

[surreal1272]

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

Edited December 6, 2015 by surreal1272

[Guest Wings4Life(BANNED)]

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

 

 

 

Yeah, thanks, but I don't believe any 'company' is telling any other 'company' how or what to sell.  Not sure where in Hades you got that from.

 

The 'old guard' companies are simply hedging their bets by selling EVERYTHING and more power to them.

[ocnblu]

Baloney.  I write all my own material.  You definitely cannot say the same exact thing.

[Guest Wings4Life(BANNED)]

Baloney.  I write all my own material.  You definitely cannot say the same exact thing.

 

???

 

Is that for me?

If so, LOL.  Who does not.

[ocnblu]

 

Baloney.  I write all my own material.  You definitely cannot say the same exact thing.

 

???

 

Is that for me?

If so, LOL.  Who does not.

 

Captured for perpetuity. 

[surreal1272]

 

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

 

 

 

Yeah, thanks, but I don't believe any 'company' is telling any other 'company' how or what to sell.  Not sure where in Hades you got that from.

 

The 'old guard' companies are simply hedging their bets by selling EVERYTHING and more power to them.

 

Yes they are trying to tell them what to do via lobbying through states like Michigan by saying that they can't sell there unless they do it through a dealer network. That is the very definition of telling someone how and what they can sell. That is what in Hades I got that from. If you believe anything else, well then it is pure blindness on your part but not surprising given that your employer is one of the companies lobbying hard against Tesla.

[ccap41]

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

+1.5million.

[Guest Wings4Life(BANNED)]

 

 

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

 

 

 

Yeah, thanks, but I don't believe any 'company' is telling any other 'company' how or what to sell.  Not sure where in Hades you got that from.

 

The 'old guard' companies are simply hedging their bets by selling EVERYTHING and more power to them.

 

Yes they are trying to tell them what to do via lobbying through states like Michigan by saying that they can't sell there unless they do it through a dealer network. That is the very definition of telling someone how and what they can sell. That is what in Hades I got that from. If you believe anything else, well then it is pure blindness on your part but not surprising given that your employer is one of the companies lobbying hard against Tesla.

 

 

 

Nope, sorry.....lobbying for fairness in Michigan is hardly....HARDLY....the same thing as 'telling companies' how to run their business.

You sir, are the blind one.  Clearly.

 

Nice try, when you clearly misspoke.

 

 

My point again, is that fairness is the name of the game here.  

Fairness would NOT be defined by allowing Tesla their own business model that is exclusive.

 

 

So if the industry wants a different business model, lobby for that.  No sweat off my brow and I would welcome it in fact.

But until then, a level playing field should be allowed and respected.

[surreal1272]

 

 

 

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

 

 

 

Yeah, thanks, but I don't believe any 'company' is telling any other 'company' how or what to sell.  Not sure where in Hades you got that from.

 

The 'old guard' companies are simply hedging their bets by selling EVERYTHING and more power to them.

 

Yes they are trying to tell them what to do via lobbying through states like Michigan by saying that they can't sell there unless they do it through a dealer network. That is the very definition of telling someone how and what they can sell. That is what in Hades I got that from. If you believe anything else, well then it is pure blindness on your part but not surprising given that your employer is one of the companies lobbying hard against Tesla.

 

 

 

Nope, sorry.....lobbying for fairness in Michigan is hardly....HARDLY....the same thing as 'telling companies' how to run their business.

You sir, are the blind one.  Clearly.

 

Nice try, when you clearly misspoke.

 

 

My point again, is that fairness is the name of the game here.  

Fairness would NOT be defined by allowing Tesla their own business model that is exclusive.

 

 

So if the industry wants a different business model, lobby for that.  No sweat off my brow and I would welcome it in fact.

But until then, a level playing field should be allowed and respected.

 

It is the same when they are not allowing Tesla to sell there because they won't sell through a dealership like the rest. That is not "fairness". You can type it all you want but that doesn't make it so. Again, I don't expect an employee of one the companies lobbying against them to understand. Your agreement on this is not required for it to be the truth. 

[oldshurst442]

Fairness...by not allowing a legal business  to do....business...in a very capitalistic way...by cutting out the middleman...in a very free market country...

 

HA!

 

Wings....trying to control the market by favouring one way over another is very contradictory to what your country stands for...in fact...many Americans have died defending this particular way and the so called freedoms it carries....during WW2 and Korea and especially in Viet Nam...

 

 

Americans have painted other Americans during the 1950s as Commies...that was known as McCarthyism....

Americans  love to hate socialists....and make fun of Canada for this very reason that Michigan is denying Tesla...

 

So.....how is selling to the public outright unfair?

 

I thought 'twas necessary for a car maker to have a dealership because of all that inventory they need to have in a showroom....if anything...Tesla is at a disadvantage with this kinda business model...

 

OK....it is not a disadvantaged...rather an advantage...because that is what YOU are saying....

 

OK...that means that dealerships only screw the customer...so why should I feel for the old guard again?

 

OK....that is not the reason you say?

What is this disadvantage you talk about?

 

Is it because the old guard is an antiquated way of doing business because THAT is what YOU are implying....

 

So...why should a car company NOT break the mold and MODERNIZE the business model?

 

The old guard cant have it both ways....

 

They cant continue with a very dated way of doing business and they cant stop progress...

Edited December 7, 2015 by oldshurst442

[surreal1272]

Fairness...by not allowing a legal business  to do....business...in a very capitalistic way...by cutting out the middleman...in a very free market country...

 

HA!

 

Wings....trying to control the market by favouring one way over another is very contradictory to what your country stands for...in fact...many Americans have died defending this particular way and the so called freedoms it carries....during WW2 and Korea and especially in Viet Nam...

 

 

Americans have painted other Americans during the 1950s as Commies...that was known as McCarthyism....

Americans  love to hate socialists....and make fun of Canada for this very reason that Michigan is denying Tesla...

 

So.....how is selling to the public outright unfair?

 

I thought 'twas necessary for a car maker to have a dealership because of all that inventory they need to have in a showroom....if anything...Tesla is at a disadvantage with this kinda business model...

 

OK....it is not a disadvantaged...rather an advantage...because that is what YOU are saying....

 

OK...that means that dealerships only screw the customer...so why should I feel for the old guard again?

 

OK....that is not the reason you say?

What is this disadvantage you talk about?

 

Is it because the old guard is an antiquated way of doing business because THAT is what YOU are implying....

 

So...why should a car company NOT break the mold and MODERNIZE the business model?

 

The old guard cant have it both ways....

 

They cant continue with a very dated way of doing business and they cant stop progress...

^This!

[Guest Wings4Life(BANNED)]

Fairness...by not allowing a legal business  to do....business...in a very capitalistic way...by cutting out the middleman...in a very free market country...

 

HA!

 

Wings....trying to control the market by favouring one way over another is very contradictory to what your country stands for...in fact...many Americans have died defending this particular way and the so called freedoms it carries....during WW2 and Korea and especially in Viet Nam...

 

 

Americans have painted other Americans during the 1950s as Commies...that was known as McCarthyism....

Americans  love to hate socialists....and make fun of Canada for this very reason that Michigan is denying Tesla...

 

So.....how is selling to the public outright unfair?

 

I thought 'twas necessary for a car maker to have a dealership because of all that inventory they need to have in a showroom....if anything...Tesla is at a disadvantage with this kinda business model...

 

OK....it is not a disadvantaged...rather an advantage...because that is what YOU are saying....

 

OK...that means that dealerships only screw the customer...so why should I feel for the old guard again?

 

OK....that is not the reason you say?

What is this disadvantage you talk about?

 

Is it because the old guard is an antiquated way of doing business because THAT is what YOU are implying....

 

So...why should a car company NOT break the mold and MODERNIZE the business model?

 

The old guard cant have it both ways....

 

They cant continue with a very dated way of doing business and they cant stop progress...

 

It's a Michigan law that our Governor recently modified to secure the loophole from,Tesla who took full advantage of in other states.  

And good for him.  No single hipster automaker should be given an advantageous business model, and no hipster should come in and demand their own rules and laws. Even Penske believes they should work with dealers rather than go around them.

Edited December 7, 2015 by Wings4Life

[surreal1272]

Big shock. A dealership saying that the new guy needs to work with dealers. Again, color me unconvinced because Penske makes a ton of money from their own dealerships so that is just not a convincing argument at all.

 

How many loopholes do you think Ford, GM, and FCA have taken advantage of over the last century?

[surreal1272]

Still have yet to hear that convincing argument of how Tesla's business model is "advantageous". Olds made some really good points as to why it could considered the opposite of that given that dealers can show multiple versions of any one car provided by the manufacturer whereas Tesla does not. That is just one of many reasons why this "advantageous" argument is not very convincing. 

 

I'm all ears to this "advantage" you speak of Wings.

[regfootball]

regardless of the constitutionality of the dealer model, this much i can assure you, and working in car sales like i did for a short time affirms this for me

 

Selling manufacturer direct won't save the consumer any money.  And you won't get an improvement in sales or service customer service.

 

The dealership owners or whoever, they have huge skin in the game, and i can guarantee they are always looking for the low hanging fruit to keep their overhead low.  A corporate ownership won't give one single f--k about the dealership they have in cosenhocken, or the local employees.

 

The good dealer chains too, know now that their empires are they size they are because of their rep on perceived customer service.  Plus, the manufacturers with their surveys and all of that.

 

The amount of staff to sell large amounts of cars is large.  There are so many different roles I cannot begin to tell you.  If you want the service you get now to stay the same or improve, there is not really a way to reduce the number of people involved.

 

Shifting ownership and management of a dealership from someone who has skin in the game to a large corporation making decisions remotely, and willing to go into or pull out of a location at the drop of a hat, won't be as invested in maintaining their presence in your backyard as you think they would.  This is not an apple store.  Corporate stores won't pay more or entitle the employees more.

 

Buying a car direct seems like a simple idea to be successful and to those with stunning credit, a decent income, and no trade to haggle over, it is.  Most new car transactions are burdened by a number of factors, all of which would grind an online only process to a halt and render it inoperable.  "come in to see our finance person' would be the most uttered retort.  Most people can't pay rent, this is why the process of selling cars is so hard.

 

Custom ordering a car would be more possible, or at least we might see innovations in distribution.  For example, company stores might not send their whole inventory to individual dealers.  They might ship them to large warehouses.  If you configure a car exactly as you wish, and its at a warehouse instead of a specific dealer, it might be easier to get that way.

 

If Tesla wanted to gain buyers, then why is the model X so ugly, so expensive, and why does it have useless stupid doors?  If GM made the design like the Model X it would get hammered for making Aztec 2 (by the way my Aztec was ugly but it was a terribly functional car).  Tesla needs to get with some designers who won't compromise form and who know how to make a good looking vehicle.  At some point their cute little cult following is not big enough and their designs will be held up to scrutiny like all other mass market makers.

Edited December 7, 2015 by regfootball

[surreal1272]

That is still not a very convincing argument Reg. especially when you slide in that little OpEd about the cars themselves like it has anything to with their business model versus the dealership model. I worked in car sales about twelve years ago so I know what it takes to keep the machine running and they are more than free to continue to run with that model if they want. I am more in line of giving the customer a choice and if the model that Tesla is running truly sucks as much as you claim, then they will just wither away and die or change and adapt. However, that does not seem to be case and that is why the old guard has been getting so nervous over the last few years. Again, if they can't adapt to the change that may actually benefit all customers, then they will simply be left behind.

[oldshurst442]

@ Wings...

 

advantageous.....

 

So we punish and become a Commie state because Michigan laws and the big Detroit 3 are antiquitated

 

Becaue Tesla is a brand new company that does not want to be burdened and shackled with a flawed business model...so we continue on with a middle ages approach...

 

I can see clearly now...Michigan State laws are ISIS and ISIL...

 

 

LMFAO!!!

Edited December 7, 2015 by oldshurst442

[oldshurst442]

@ Reg...

 

So...if Tesla wont benefit the consumer...what advantages are there for Tesla....if I cant haggle the price and save me some money...Ill still buy a Porsche EV or a Chevy Volt...where that business modle helps me...and that business model clearly helps the old guard...

 

 

 

 

Guys...YOU CANT HAVE IT BOITH WAYS!!!! Either Tesla's way is NOT advantageous or it is....pick one and go with that...dont flip flop...

 

 

But it seems to me ya'll afraid of change or afraid of Tesla or just plain evil...you folk WAQNT to join the Drak Side....

 

Come to the Dark Side...it is your Destiny...I have FORESEEN IT!!!

 

 

[ocnblu]

That is still not a very convincing argument Reg. especially when you slide in that little OpEd about the cars themselves like it has anything to with their business model versus the dealership model. I worked in car sales about twelve years ago so I know what it takes to keep the machine running and they are more than free to continue to run with that model if they want. I am more in line of giving the customer a choice and if the model that Tesla is running truly sucks as much as you claim, then they will just wither away and die or change and adapt. However, that does not seem to be case and that is why the old guard has been getting so nervous over the last few years. Again, if they can't adapt to the change that may actually benefit all customers, then they will simply be left behind.

But they are not "getting nervous", how do you figure that?  I don't see that in the least here.

[Drew Dowdell]

No one likes the dealership models except dealerships.

 

Customers do not like the dealership model because it places an annoying barrier between them and the manufacturer when issues arise.

Customers do not like the dealership model because it increases the cost of the car.

Customers do not like the dealership model because the experience is fairly inconsistent from dealer to dealer even in the same brand.

 

Manufacturers do not like the dealership model because they do not have as much control over the presentation and pricing of the cars. 

Manufacturers do not like the dealership model because it adds a layer of bureaucracy to the overall process of selling and servicing a car. 

Manufacturers do not like the dealership model because it is hard to nearly impossible get rid of bad apples. 

 

Dealerships are NOT scared of having to compete with Tesla specifically.. Dealerships are scared of Telsa disrupting their business model. Because if Tesla does that, there is nothing to stop GM, Ford, Honda, Toyota, etc from doing the same thing... and then the dealerships might actually have to compete with the service levels that a manufacturer provides.  A nationwide network of Tesla or Honda or Chevrolet stores owned by their respective manufacturers would likely have the same consistent look, feel, and level of service that shoppers are accustom to at Apple.  

 

Furthermore, dealerships are even MORE scared of the Amazoning of the car buying process. Think if you could customize your car from an app and have it delivered to your door and have your trade in picked up without ever even speaking to a dealer?  I just bought out the lease on my Buick back in August and the entire process was done electronically except the title transfer which I handled at a AAA office.  It was two pieces of paper total - the title and the statement from the credit union with the lien info with mileage statement.  There is nothing stopping that process from happening to the entire car buying process except for the NADA.

 

NONE of the consumer protections that the NADA cites as necessary and provided by the dealership model have actually proven to be true.  The only reason Saab owners can still buy parts is because ONE company not related to GM nor to Spyker decided there was enough market for Saab parts to continue to source and manufacture them.... it is NOT because of the dealers.   Suzuki owners can only buy parts because the parent company still exists and just doesn't sell cars in the US.  Fisker owners are up a creek, dealers can't help them.  

 

So take Tesla out of the equation and look at what dealerships are really fighting against.... a more transparent, convenient, cheaper, and haggle free car buying process. 

[ccap41]

 

 

 

 

Fair game, let them play by the same playground rules. And I am curious how much price increases when dealerships and sales persons are involved.  Who do they think they are, wanting their own set of rules, as they themselves would love nothing more to see than GM and Ford go belly up.

 

Efff Tesla and Efff Musk.

 

And btw, in a few years there will be many more BEV and hybrid and PHEV solutions from GM and Ford, and everyone else.

I will not shed one single tear if Tesla folds in the interim.

And I hope Tesla flips the establishment on it's old ear. No one company has the right to tell another company how to sell their product. The tactics being used by the old guard are typical of companies that are scared of change. To them I say, suck it up buttercup. Change is coming. You can adapt or get left behind.

 

 

 

Yeah, thanks, but I don't believe any 'company' is telling any other 'company' how or what to sell.  Not sure where in Hades you got that from.

 

The 'old guard' companies are simply hedging their bets by selling EVERYTHING and more power to them.

 

Yes they are trying to tell them what to do via lobbying through states like Michigan by saying that they can't sell there unless they do it through a dealer network. That is the very definition of telling someone how and what they can sell. That is what in Hades I got that from. If you believe anything else, well then it is pure blindness on your part but not surprising given that your employer is one of the companies lobbying hard against Tesla.

 

 

 

Nope, sorry.....lobbying for fairness in Michigan is hardly....HARDLY....the same thing as 'telling companies' how to run their business.

You sir, are the blind one.  Clearly.

 

Nice try, when you clearly misspoke.

 

 

My point again, is that fairness is the name of the game here.  

Fairness would NOT be defined by allowing Tesla their own business model that is exclusive.

 

 

So if the industry wants a different business model, lobby for that.  No sweat off my brow and I would welcome it in fact.

But until then, a level playing field should be allowed and respected.

 

You've yet to answer the simple question, "why is it fair to tell somebody HOW to sell their product?"  

 

Yes, there are laws telling them how to sell them. Does that make the laws correct or out of date? Here's an extreme example of laws not necessarily being right, slavery. That was considered "right" at one point. Was it? Was that FAIR?

[ocnblu]

What is to keep manufacturers from inching up list prices (cannot use the term MSRP anymore because nothing about it is "suggested") with direct retail, even more than they do now?  The perception of getting a "good deal" goes out the window.  That, to me, is not necessarily a happy outcome of a vehicle purchase.  It will take a complete rethink of the purchasing process, and it might make some ppl go for a less well equipped vehicle than they would go for if the negotiating process is eliminated.

 

GM tried it with Saturn.

[Drew Dowdell]

The NADA argument also falls on its face that it "protects" existing businesses.

 

Hotels have a dual model of franchises and brand owned, they compete just fine.

Restaurants have a dual model of franchises and brand owned, they compete just fine.

 

Apple competes with Best Buy and Target when selling their products.

 

Why are dealerships such special flowers in the consumer landscape?

[ccap41]

There are a lot of people who don't even want to deal with dealerships because the sales people are there just to take their money. They can be very pressuring and that intimidates a lot of people. Not everybody is an enthusiast and knows everything about the cars before we leave our house to go to a dealer.

 

I think what the D3 should really do is analyze their dealerships and redo how they sell cars. Make it an enjoyable experience rather than a stressful situation which most find it to be. They should use their dealerships as their advantage to showcasing cars and service and person to person contact.

 

But going to an "internet-like" sales model would make nobody ever feel like they are getting ripped off or intimidated..or pressurized..

 

I see positives to both models.

 

Personally, if the sate of Michigan is truly set on not allowing direct sales there are ways they should allow a small company to sell cars. Maybe they could put a cap on how many vehicles they are allowed to sell before having to put up dealerships or they could go the dollar route and say at X dollars of net income or revenue(whichever number they choose it really all adds up to roughly the same amount of cars sold.

 

I guess I just don't see how a new company can even enter the market if they are forced to put up dealerships right out of the gate. Allow a small company get their feet wet for however long it takes as long as they are still considered a small company, then allow them to do direct sales. If the company wants to grow then make them build dealerships and "play by the same rules" as everybody else(whether right or wrong).

[Drew Dowdell]

What is to keep manufacturers from inching up list prices (cannot use the term MSRP anymore because nothing about it is "suggested") with direct retail, even more than they do now?  The perception of getting a "good deal" goes out the window.  That, to me, is not necessarily a happy outcome of a vehicle purchase.  It will take a complete rethink of the purchasing process, and it might make some ppl go for a less well equipped vehicle than they would go for if the negotiating process is eliminated.

 

GM tried it with Saturn.

 

People LOVED the original Saturn.... they had the highest customer satisfaction rates at their dealerships in the industry.  Saturn only failed because GM failed the brand with poor, late, or outdated product.

 

Manufacturers inch up MSRP now.  

[ocnblu]

 

What is to keep manufacturers from inching up list prices (cannot use the term MSRP anymore because nothing about it is "suggested") with direct retail, even more than they do now?  The perception of getting a "good deal" goes out the window.  That, to me, is not necessarily a happy outcome of a vehicle purchase.  It will take a complete rethink of the purchasing process, and it might make some ppl go for a less well equipped vehicle than they would go for if the negotiating process is eliminated.

 

GM tried it with Saturn.

 

People LOVED the original Saturn.... they had the highest customer satisfaction rates at their dealerships in the industry.  Saturn only failed because GM failed the brand with poor, late, or outdated product.

 

Manufacturers inch up MSRP now.  

 

Dude though, if the plan had worked it would have spread, don't you think?  Everybody wants customer satisfaction, it keeps 'em coming back.

Does this then extend to the trade-in... one price for it no matter what?

Plus a hotel room, restaurant meal and a telephone is nothing like a car.