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The legislative fight for Tesla in North Carolina
- Thread starter leilanimunter
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- Energy Environment Policy
I think I'm gonna puke my dinner.
"... we must do everything we can to reject cars produced by American workers."?
I think there's a (false) sense that Tesla's business model means that there's no job creation in the state. Car dealers don't create jobs -- people buying cars (and having them serviced) create jobs.
I had an interesting dialog with a old friend on this subject. He's very smart and a good economist. His opening line was, "Tesla will need to shift to a dealership model eventually." Why, I asked.
The first reason he gave was inventory costs. But, I replied, why does he think that small businessmen (car dealers) have lower cost of capital than a publicly traded firm? Moreover, Tesla doesn't plan on carrying large inventories, but to operate on the European model of light inventory and factory orders.
But people won't accept that, he replied, they want their cars promptly. I pointed out that he himself hadn't bought a car from a lot in the thirty years I've known him.
Then he tried the "dealers know their market better" angle. Really? What exactly do car dealers do differently in one region than another? The product is identical; it's not like a restaurant that's using local ingredients. Local car ads for major brands all seem to be nationally produced now anyway, with the local dealership's name plastered in at the end.
But, he countered, car dealerships have an important role in local communities. But what makes you think that Tesla won't be sponsoring community events where it is located?
In the end, I think it boils down to a resistance to change. Car dealerships are demonstrably poor ways of selling cars in the modern era: they use capital inefficiently, they use labor inefficiently, and they fail to leverage modern communications well. Time to say farewell to them....
I had an interesting dialog with a old friend on this subject. He's very smart and a good economist. His opening line was, "Tesla will need to shift to a dealership model eventually." Why, I asked.
The first reason he gave was inventory costs. But, I replied, why does he think that small businessmen (car dealers) have lower cost of capital than a publicly traded firm? Moreover, Tesla doesn't plan on carrying large inventories, but to operate on the European model of light inventory and factory orders.
But people won't accept that, he replied, they want their cars promptly. I pointed out that he himself hadn't bought a car from a lot in the thirty years I've known him.
Then he tried the "dealers know their market better" angle. Really? What exactly do car dealers do differently in one region than another? The product is identical; it's not like a restaurant that's using local ingredients. Local car ads for major brands all seem to be nationally produced now anyway, with the local dealership's name plastered in at the end.
But, he countered, car dealerships have an important role in local communities. But what makes you think that Tesla won't be sponsoring community events where it is located?
In the end, I think it boils down to a resistance to change. Car dealerships are demonstrably poor ways of selling cars in the modern era: they use capital inefficiently, they use labor inefficiently, and they fail to leverage modern communications well. Time to say farewell to them....
Citizen-T
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