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New Texas Bill to Screw Tesla Owners!
- Thread starter LoveMX
- Start date
Brando
Active Member
Only about 1/2 of the States allow sales of Tesla - see below sales map for details
Tesla Direct Sales Map (US)
Tesla Direct Sales Map (US)
Tam
Well-Known Member
This goes further than sales.
It attacks at another angle: Service.
It makes potential customers think twice: OK, they figured out how to buy one out-of-state but now, Service will be banned also!
This bill has nothing to do with sales. Tesla has never been able to sell in Texas, that's why we have "galleries" instead of stores, and the online sales technically take place in California. This bill is about banning Tesla from operating service centers in the state, by changing the definition of "dealership" that can't be owned by a manufacturer. Michigan is the only state that currently bans Tesla service centers I believe.
When I said the bill has nothing to do with sales, I should have said nothing directly to do with sales. Because you can imagine what would happen to Tesla sales if there were no longer any service centers here. That's obviously TADA's intent with this rent-seeking bill, to kill Tesla sales legislatively because they can't do it in the free market. It's really a desperation move by the auto dealer cartel.
When I said the bill has nothing to do with sales, I should have said nothing directly to do with sales. Because you can imagine what would happen to Tesla sales if there were no longer any service centers here. That's obviously TADA's intent with this rent-seeking bill, to kill Tesla sales legislatively because they can't do it in the free market. It's really a desperation move by the auto dealer cartel.
It's amazing to me that a representative would stand up and say "Me, Me! I'm in the pocket of a special interest group!" I mean, to not rescind an existing law that was put on the books by someone bribed the past is pretty anonymous. But to put up a brand new bill? Wow.
reddy
Active Member
This bill accomplishes 2 objectives:
TADA expected to be defending themselves from another attempt by Tesla to allow sales in Texas. Their idea is 'the best defense is a good offense'. So they have gone on the offensive, and hope for a compromise where they don't allow Tesla sales.
Of course, if this crazy bill passes , (and in Texas anything can happen) , then all Texas Tesla owners will be harmed in a profound way. Where exactly would we get service ? Oklahoma City ? Lake Charles ?
The bill also, in a very sly way, corrects a big problem for Warren Buffett and Berkshire Hathaway. They own an RV manufacturer. They also own dozens of franchised Texas auto dealerships. So a motor vehicle manufacturer owns dealerships. They are technically out of compliance with the Texas Occupations Code. It corrects this problem by simply adding 2 words , 'same type'. So you can be an automotive manufacturer, and a dealer, if they aren't of the 'same type'.
So this bill has HUGE backing from Berkshire Hathaway lobbyists.
I am writing my state legislators TODAY. If you live in Texas, you need to write or call your reps ASAP.
TADA expected to be defending themselves from another attempt by Tesla to allow sales in Texas. Their idea is 'the best defense is a good offense'. So they have gone on the offensive, and hope for a compromise where they don't allow Tesla sales.
Of course, if this crazy bill passes , (and in Texas anything can happen) , then all Texas Tesla owners will be harmed in a profound way. Where exactly would we get service ? Oklahoma City ? Lake Charles ?
The bill also, in a very sly way, corrects a big problem for Warren Buffett and Berkshire Hathaway. They own an RV manufacturer. They also own dozens of franchised Texas auto dealerships. So a motor vehicle manufacturer owns dealerships. They are technically out of compliance with the Texas Occupations Code. It corrects this problem by simply adding 2 words , 'same type'. So you can be an automotive manufacturer, and a dealer, if they aren't of the 'same type'.
So this bill has HUGE backing from Berkshire Hathaway lobbyists.
I am writing my state legislators TODAY. If you live in Texas, you need to write or call your reps ASAP.
reddy
Active Member
Tam
Well-Known Member
Tesla Service Centers benefit Texas taxpayers due to local constructions, employees, technicians...
The value of service is also taxable and enhances Texas treasury.
Tesla sales benefit Texas treasury too but TADA does not care about taxpayers.
If they can benefit by keeping Texans behind in high tech and green tech, they would get all the laws to do that.
It would be funny if Elon creates a new independent company, call it "California Love" just to piss Texas off. Then sell the entire Texas portfolio to them, agree on a contract with "California Love" to service all Tesla vehicles for a small fee independently of the manufacture. I think it would be good theater.
Yinn
Active Member
I'm not to well versed in this. But could someone explain to me a couple of things?
1. Would a mobile service team still be considered a "dealer" in this case?
2. Why wouldn't Tesla be able to stand up a franchise model, then own the franchise as a separate legal entity but fully controlled by Tesla?
3. Is this the worst thing in the world? You can still buy the cars. Given some of the complaints around Tesla part availability, service speed, wouldn't this actually be a good thing to open up the market?
All of the above are specific to service, the purchasing thing remains silly.
1. Would a mobile service team still be considered a "dealer" in this case?
2. Why wouldn't Tesla be able to stand up a franchise model, then own the franchise as a separate legal entity but fully controlled by Tesla?
3. Is this the worst thing in the world? You can still buy the cars. Given some of the complaints around Tesla part availability, service speed, wouldn't this actually be a good thing to open up the market?
All of the above are specific to service, the purchasing thing remains silly.
1. Depends on how the provide service clause in the bill is interpreted. In some states, the mobile service is actually run from a neighbouring state. That's not really practical in Texas.
2. The wording, as I interpret it, prohibits and franchise or non-franchise dealer or dealership to be owned directly or indirectly by a manufacturer. In some states the wording is that if a dealership is owned anywhere, the manufacturer is then prohibited from selling and perhaps servicing--so Tesla can't open up any kind of dealership anywhere without shutting down operations in those states.
3. How? Because car delivery is in the wording, every car would have to be trucked individually to the buyer, or the buyer would have to go pick it up out of state. This would not open up the market, it would close it almost completely. Now some individuals, such as myself, would go and pick up the car from some other state, but I suspect I'm in the minority.
Most parts have no problems with availability. Service speed hasn't been a problem overall, except in California. I'm sure there are a few exceptions--there are always exceptions.
Yinn
Active Member
In my area it’s not uncommon for service to be scheduled weeks out. I’ve been out out 3 months before. That’s in a state that allows Tesla to sell and service. Whether by excuse or actuality, once it’s in there’s usually a 2-3 week delay for parts.
I personally wouldn’t mind if they allowed some independent service shops to compete with Tesla service centers. My hope is that they either need to make parts available to those independent shops, or stand up more centers.
IF this bill passes, Tesla will be able to find a workaround, possibly by selling the Service Centers to a friendly 3rd party, and then subcontracting the actual work back to Tesla.
Just because a bill has been introduced, doesn't mean it will pass - even with the strong support of the TADA.
But, if it does, this could actually be a really good thing for Tesla in the long run. This overreach might provide enough ammunition to build a strong case against all of the state-level dealership protections, demonstrating how they restrict interstate commerce and adversely impact customers.
While the dealerships will continue to fight Tesla, it's inevitable they are playing a losing hand. Ultimately their survival will be based not on state-level legal protections they've been able to acquire through their well-funded lobbies and campaign contributions, but on the actual value they are providing to customers.
When we owned ICEs - we purchased them and had them serviced at some great dealerships - but from a customer perspective, it really doesn't matter if the stores/service locations are owned by local businesses or by the manufacturer.
Rather than spending all of their $$$ to fight against Tesla, they may better off investing that $$$ with improvements in their business models and operating efficiencies - and demonstrate to their manufacturers that they're better off going through the dealerships than considering a shift to direct sales...
So we're not too concerned about this bill. It's probably a long shot to pass in Texas, which generally places few restrictions on businesses. And even if it does, Tesla should be able to find a way to workaround the new restrictions and continue supporting their current and new customers in Texas. And this bill could help throw out all of the dealership restrictions in federal courts.
So - bring it on...
Just because a bill has been introduced, doesn't mean it will pass - even with the strong support of the TADA.
But, if it does, this could actually be a really good thing for Tesla in the long run. This overreach might provide enough ammunition to build a strong case against all of the state-level dealership protections, demonstrating how they restrict interstate commerce and adversely impact customers.
While the dealerships will continue to fight Tesla, it's inevitable they are playing a losing hand. Ultimately their survival will be based not on state-level legal protections they've been able to acquire through their well-funded lobbies and campaign contributions, but on the actual value they are providing to customers.
When we owned ICEs - we purchased them and had them serviced at some great dealerships - but from a customer perspective, it really doesn't matter if the stores/service locations are owned by local businesses or by the manufacturer.
Rather than spending all of their $$$ to fight against Tesla, they may better off investing that $$$ with improvements in their business models and operating efficiencies - and demonstrate to their manufacturers that they're better off going through the dealerships than considering a shift to direct sales...
So we're not too concerned about this bill. It's probably a long shot to pass in Texas, which generally places few restrictions on businesses. And even if it does, Tesla should be able to find a way to workaround the new restrictions and continue supporting their current and new customers in Texas. And this bill could help throw out all of the dealership restrictions in federal courts.
So - bring it on...
Yes that’s been a problem sometimes but it’s irrelevant to this discussion. If parts aren’t available from Tesla for two weeks, they’re not available from Tesla for two weeks— either to the service center or a hypothetical independent shop. This is not a problem that needs to be addressed by legislation.
"...So we're not too concerned about this bill. It's probably a long shot to pass in Texas..."
It's a longer shot if enough publicity is generated that the originators (TADA lobbyists) and sponsor (Hancock) look ludicrous and never try it again.
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