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NPR: Car Dealers Sue Tesla, Citing State Franchise Laws
- Thread starter ElSupreme
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- dealership laws News
It would be interesting to see this backfire:
"In a landmark decision, not only was Tesla point of view supported but the existing dealership laws were recognized as outdated and not appropriate for today's marketplace. As such, GM and other established automakers are now allowed to open their own stores with the following restrictions: ..."
I agree with other posters: this is not about Tesla. This is about protecting existing dealerships from being undermined by their OEMs by direct internet sales. Think about it: if GM offered internet sales for their cars, they could undercut GM dealerships severely, while still relying on those dealerships to provide free test-drives and car services. Bookstores have had this issue with Amazon, and the car dealers are determined not to go down this road.
Because this isn't about Tesla, there's room for a settlement. I doubt there will ever be a bench decision, let alone a landmark decision. (Unless I can get DOJ to vacate these laws entirely.)
Because this isn't about Tesla, there's room for a settlement. I doubt there will ever be a bench decision, let alone a landmark decision. (Unless I can get DOJ to vacate these laws entirely.)
artsci
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Norbert
TSLA will win
From http://www.law.fsu.edu/journals/lawreview/downloads/293/Forehand.pdf :
The term "forced acceptance of unordered autos or parts" reminded me of the difficulties Nissan had (or still has) with dealers selling the Leaf and/or providing fast-chargers and/or L2 chargers to customers, be it their own customers or those of other dealers. How can a company sell EVs (or any other product which has effects on the business model), if dealers don't want to sell or stock them? (And Nissan has the advantage of being an established company).
Reading more from the above link (which isn't specifically about Wisconsin) suggests that the concept of an "unfair advantage" comes specifically from the scenario of a franchised dealer competing with company stores. The manufacturers can exert power (for example on the margin) through limiting supply with cars (especially ones that are in short supply). Or, I *guess*, by enforcing different requirements, per contract, on the dealers, than on its own company stores. However, having to cope with manufacturer's requirements is only "unfair" if there are *different requirements* for different dealers or manufacturer stores. I suppose that different manufacturers are still free to have different requirements.
All that reasoning only applies *if* there is a franchised dealer to be protected against "abuse" and unfairness. It cannot (or should not) inherently mean that a company has an obligation to create franchised dealers, who then need to be protected.
It appears that these laws protect franchised dealers from their *own* OEMs from who they obtain a franchise agreement, and not from competing brands or products.
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To make that point clearer, the laws (in so far as they are being discussed, to our knowledge) appear to be meant to protect one party in a franchise agreement against another party in that franchise agreement. Once such an agreement exists.
However, there exists no such agreement between the dealers who are suing, and Tesla.
The term "forced acceptance of unordered autos or parts" reminded me of the difficulties Nissan had (or still has) with dealers selling the Leaf and/or providing fast-chargers and/or L2 chargers to customers, be it their own customers or those of other dealers. How can a company sell EVs (or any other product which has effects on the business model), if dealers don't want to sell or stock them? (And Nissan has the advantage of being an established company).
Reading more from the above link (which isn't specifically about Wisconsin) suggests that the concept of an "unfair advantage" comes specifically from the scenario of a franchised dealer competing with company stores. The manufacturers can exert power (for example on the margin) through limiting supply with cars (especially ones that are in short supply). Or, I *guess*, by enforcing different requirements, per contract, on the dealers, than on its own company stores. However, having to cope with manufacturer's requirements is only "unfair" if there are *different requirements* for different dealers or manufacturer stores. I suppose that different manufacturers are still free to have different requirements.
All that reasoning only applies *if* there is a franchised dealer to be protected against "abuse" and unfairness. It cannot (or should not) inherently mean that a company has an obligation to create franchised dealers, who then need to be protected.
It appears that these laws protect franchised dealers from their *own* OEMs from who they obtain a franchise agreement, and not from competing brands or products.
- - - Updated - - -
To make that point clearer, the laws (in so far as they are being discussed, to our knowledge) appear to be meant to protect one party in a franchise agreement against another party in that franchise agreement. Once such an agreement exists.
However, there exists no such agreement between the dealers who are suing, and Tesla.
Sounds a lot like being forced to buy something so that you are "involved in commerce" so that the government can regulate it.
Now where have I heard that before recently...
I assume it would be much easier and appropriate to send them slightly north to CA the country from CA the state ...
Just imagine the precident it would set if the dealers won. Would all the Travel Agents go after the airlines for back commissions?
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