Tesla Stores

[KBF]

I should add my 2 cents worth, since I was brought into the conversation anyway :wink:

My generation and younger are typically researching (and buying) everything online. When I last bought a car from a dealer, I knew more than the salesman did, although it was difficult to research exactly what their upsells were about (you know, when you are brought into the manager's office and he tries to force you to buy extra coverage of all kinds, prepay service, and all that crap). I hate it. It's almost as bad as buying mattresses, that industry does its best to make side-by-side comparisons impossible.

So essentially, dealers add little other than markup. Test drives are nice, but you don't need a dealer for that. I'll be giving out a lot of test drives once my S arrives, no store required. I already often do tire service and oil changes at independent shops.

But the dealer isn't entirely at fault. I have a good friend who is in charge of the warranty department at a local Ford dealership, and the manufacturers do their best to weasel out of warranty and screw over the dealerships. It's a bad situation. Direct warranty is a HUGE benefit to Tesla's model (cut down on paperwork etc.)

Basically for me, the Tesla store model is one major reason why I'm not waiting for BMW or Ford or others to come out with a real electric (designed as an electric). There are hurdles to overcome, but if I can spare my kids the hassle of "going into the back room" to fend off last-minute add-ons, it will be worth it and the world will be a better place. [/sermon]

P.S. Tesla, I'd love a service centre within 250 miles of my house!

 

[jerry33]

My generation and younger are typically researching (and buying) everything online.

That's a terrible sterotype. My guess is that I'm quite a bit older than you and I've been buying almost everything but cat litter and perishable groceries on line for over 15 years now. This includes things like my last two car purchases (Prius), the roof on my house, the plants in my yard, clothes, computers, etc.

 

[KBF]

That's a terrible sterotype. My guess is that I'm quite a bit older than you and I've been buying almost everything but cat litter and perishable groceries on line for over 15 years now. This includes things like my last two car purchases (Prius), the roof on my house, the plants in my yard, clothes, computers, etc.

You're above average, cheers! It is a generalization, a trend and I agree that more and more older people buy more online, too. My dad is starting to but he still occasionally likes "the dealership game". Even he's getting tired of it, though. Buying direct makes a lot of sense in the digital age.

 

[qwk]

I don't think people are understanding if the wait is 6 months or less with a traditional auto maker but Tesla's shown incredible transparency. I think Tesla buys would be able to wait 8 months. So if you put dealerships in place it will allow people to learn about the cars and save up for the top model. My point is that traditional buyers aren't going to be comfortable enough buy cars online that they've never seen. Which effectively means your selling cars to EV enthusiasts and people in the cities with dealerships.

Most people, including myself, would rather get kidney punched rather than go through the dealership buying experience. It's time to let that business die.

 

[brianman]

This reminds me of the commercial for...Klondike?

"How many kidney punches would you willingly suffer to get your Model S in 2012?"

Edit: Yup, Klondike.
http://www.youtube.com/results?search_query=what+would+you+do+for+a+klondike+bar&oq=what+would+you+do+for+a+kl&gs_l=youtube.3.0.0l10.4348.6412.0.7937.26.13.0.12.12.0.95.460.13.13.0...0.0...1ac.R-GNMgSv9vc

 

[BenTesla]

Please listen to what I'm saying!!! The franchise model would allow for quick/ quicker expansion. Tesla can still control everything down to the uniforms the employees wear but they should really have a better system to offer test drives and help people learn about the cars. I know Tesla's and electric cars in general require less maintenance but to have a Tesla trained mechanic near by is essential. I'm never said create a traditional dealership model, I said expand faster and franchised dealerships (in whatever way they see fit) would be one way of doing that.

To summarize: even if they put a stick in the group with a Tesla logo on it. I want a convenient way to receive test drives, service and to see new models in person.

 

[brianman]

Please listen to what I'm saying!!! [1]The franchise model would allow for quick/ quicker expansion. [2] Tesla can still control everything down to the uniforms the employees wear but [3] they should really have a better system to offer test drives and help people learn about the cars. I know Tesla's and electric cars in general require less maintenance but [4] to have a Tesla trained mechanic near by is essential. I'm never said create a traditional dealership model, [5] I said expand faster and franchised dealerships (in whatever way they see fit) would be one way of doing that.

We are listening. That doesn't mean we have to agree with you.

[1] They are production constrained, not demand constrained. Expansion is not currently the priority.
[2] No, they can't. There are legal constraints on the franchise relationship.
[3] Franchises wouldn't move this needle in either direction. Current contraint is limited number of vehicles available for test drives from the production line.
[4] Asserting this doesn't make it fact. What makes you think franchises will be better for mechanic availability than service centers? We already have evidence that franchise mechanics are likely more expensive for customers, which is undesirable.
[5] Again, production constrained. Expanding faster right now just increases costs with no product delivery income to counterbalance it.

 

[dflye]

Please listen to what I'm saying!!! The franchise model would allow for quick/ quicker expansion.

In retail, you really don't want to ramp up the sales force prior to the manufacturing ramp up. Otherwise that leads to very, very annoyed customers waiting for their perpetually delayed purchase to be delivered. (Which reminds me I need to cancel an Amazon technical book pre-order of over a year ago where apparently the author took the initial payment and ran!)

Also, the franchise model is essentially based upon graft: which is money needlessly spent if the vendor just goes direct.

 

[vfx]

Please listen to what I'm saying!!! The franchise model would allow for quick/ quicker expansion.....

There has been gathering dealership experiences from all over the country. Salespeople are not doing a very good jobs selling EVs. It is nearly the same s last time with GM's EV1 (Watch WKTEC) We all know that EVs do not maximize parts revenue for the dealership and sales people are poorly trained and don't seem to care (except a few). People are steered away from EVs, Dealerships keep them in back or let stock go dry.

One comment from sales people is that they have to spend a lot more time explaining all the new tech of an EV. Something a Tesla store does a thousand times a day. If there are 15 ICEs models on the lot it's just plain an easier sale to show what the buyer is familiar with, The quicker you sell the quicker they go onto the next one.

 

[dsm363]

I think the only way for the franchise model to work would be to not allow them to sell anything else since they could shift customers towards their higher profit (more service dollars) ICEs. If that's accurate then why wouldn't Tesla just control everything themselves?

 

[Doug_G]

There has been gathering dealership experiences from all over the country. Salespeople are not doing a very good jobs selling EVs.

From what I have seen, many dealerships and salespeople are actively hostile to EVs. I think major automakers will have to build a completely separate brand and dealer network, a la (now-defunct) Saturn, to be successful with them.

 

[jerry33]

From what I have seen, many dealerships and salespeople are actively hostile to EVs. I think major automakers will have to build a completely separate brand and dealer network, a la (now-defunct) Saturn, to be successful with them.

That's certainly been my experience. EVs and Hybrids are sold only if you hold a gun to the salespersons head. Salespeople are paid to move the cars sitting on the lot. These are always the cars that the dealer makes the most money on.

 

[qwk]

Please listen to what I'm saying!!! The franchise model would allow for quick/ quicker expansion. Tesla can still control everything down to the uniforms the employees wear but they should really have a better system to offer test drives and help people learn about the cars. I know Tesla's and electric cars in general require less maintenance but to have a Tesla trained mechanic near by is essential. I'm never said create a traditional dealership model, I said expand faster and franchised dealerships (in whatever way they see fit) would be one way of doing that.

To summarize: even if they put a stick in the group with a Tesla logo on it. I want a convenient way to receive test drives, service and to see new models in person.

Again, no thanks. Franchised dealerships screw their customers much too often, and like the other forum members pointed out, the salesmen don't know much and try to push people into a sale of a vehicle they don't want. Tesla is going about this the right way.

If you really are interested in this vehicle, a flight to the nearest store for a test drive(when available to non reservation holders) is most likely only a few hundred bucks. That is definately not impossible for someone who buys a car in this price range.

 

[KBF]

Air miles are great.

 

[BenTesla]

So I appreciate finally getting responds that addressed my concerns but my next question is Does Apple own their stores?

 

[BenTesla]

So I appreciate finally getting responds that addressed my concerns but my next question is Does Apple own their stores?

{Looked it up myself} No there not franchised but they do have 'certified sellers'. I don't think the ability to get a weekend test drive and when I purchase a vehicle be able to go to a mechanic that you've trained. If I was to buy a BMW or a Benz these are things they'd give me, why wouldn't Tesla want to compete on a level playing field? Like I said earlier I'm going to buy a car no matter what but how do they expect normal people to buy Tesla's? If not franchises (You all seem to be VERY against the idea) What?

 

[spleen]

So I appreciate finally getting responds that addressed my concerns but my next question is Does Apple own their stores?

yes, they do. Not the floor space (since that's obviously leased from mall management) but everything else including all the employees.

 

[brianman]

the ability to get a weekend test drive ... If I was to buy a BMW or a Benz these are things they'd give me, why wouldn't Tesla want to compete on a level playing field?

I think you're asking three questions:

(1) Why doesn't Tesla offer test drives at the store like BMW/Mercedes do at their franchises?
They've already said they plan to do so, and hinted at sometime in September.

(2) Isn't a franchise-based test drive experience better than a store test drive?
I have no idea where you get this expectation from. I would expect them to be equivalent.

(3) Why wouldn't Tesla want to compete on a level playing field?
Because they'd prefer to compete on an advantageous playing field instead. Stores have more flexibility than franchises due to legally enforced requirements on franchise-manufacturer relationships.

 

[dsm363]

{Looked it up myself} No there not franchised but they do have 'certified sellers'. I don't think the ability to get a weekend test drive and when I purchase a vehicle be able to go to a mechanic that you've trained. If I was to buy a BMW or a Benz these are things they'd give me, why wouldn't Tesla want to compete on a level playing field? Like I said earlier I'm going to buy a car no matter what but how do they expect normal people to buy Tesla's? If not franchises (You all seem to be VERY against the idea) What?

Tesla doesn't want to be on their playing field, they'll create their own. As Tesla grows, so will their store and service network. Define 'normal' people too. What do you mean by "when I purchase a vehicle be able to go to a mechanic that you've trained". Do you mean that Tesla trained? All of their service people are Tesla employees so they are trained by Tesla. Not sure how it would get better than that.

Would it be ideal for Tesla to have a store in every city above 100,000 people? Sure but that would cost a ton of money. Tesla can find more than enough customers within 200 miles of the major cities they'll have store in over the next decade. If they're successful, then I'm sure they move out to smaller markets as their need dictates.

 

[vfx]

{Looked it up myself}... If not franchises (You all seem to be VERY against the idea) What?

Ben,

There is another problem you may want to look up. Tesla has decided NOT to go the dealership franchise route. Federal law says an auto maker cannot open a store that would compete with dealerships. That would have them direct violation of laws that the powerful dealership lobby had enacted in the 40's when automakers tried to do this.

So if Tesla allowed even one franchise they would have to close all their stores and they would have to go to a fully franchised model. Or they continue the path they are on and only have manufacture owned stores. You can do one or the other, but not both.

So you might as well let it go and be patient to when they get to your area.