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Why is Tesla moving towards the dealership model and folding to franchise law?

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There's a reason the big car manufacturers started the dealer model in the first place. When you're mass-marketing cars all over the country, managing centralized sales operations would be a huge endeavor. It makes some sense to spin that off, put it in the hands of franchisees, and let them take care of sales while the company focuses on manufacturing.

If Tesla goes that route, though, I hope they'll figure out how to do it without devolving into that same kind of commissioned-sales smarminess that goes along with other car dealerships. I had a great buying experience with Tesla and I'd be sad for people that buy the mass-market Gen III if they don't get the same treatment.
 
There's a reason the big car manufacturers started the dealer model in the first place. When you're mass-marketing cars all over the country, managing centralized sales operations would be a huge endeavor. It makes some sense to spin that off, put it in the hands of franchisees, and let them take care of sales while the company focuses on manufacturing. /...
But wasn’t that some one hundred years ago (!)…
 
There's a reason the big car manufacturers started the dealer model in the first place. When you're mass-marketing cars all over the country, managing centralized sales operations would be a huge endeavor. It makes some sense to spin that off, put it in the hands of franchisees, and let them take care of sales while the company focuses on manufacturing.

If Tesla goes that route, though, I hope they'll figure out how to do it without devolving into that same kind of commissioned-sales smarminess that goes along with other car dealerships. I had a great buying experience with Tesla and I'd be sad for people that buy the mass-market Gen III if they don't get the same treatment.

Modern IT capabilities and the Internet have changed everything.

The most efficient business models should have specialist 3rd parties, basically outsourcing, but the problem is that the US states' laws get in the way because they enforce a large amount of separation. Because the Internet has made the direct model much cheaper, the outsourcing costs are now much greater than the savings.

Tesla will consider franchising, but they won't do it under the current laws.
 
No it wasn't. It might have been a partial victory for Tesla shareholders, but a special exception for Tesla does not further the mission.

It is an ABSOLUTE VICTORY for Tesla. And it does not harm the larger mission.

The purpose of Tesla is to electrify the automobile not legalize automotive factory stores in the USA.

Tesla will educate the public on BEVs.

Once that happens lazy dealership salesman on commission will not be an impediment to regular joes buying BEVs.

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There's a reason the big car manufacturers started the dealer model in the first place. When you're mass-marketing cars all over the country, managing centralized sales operations would be a huge endeavor. It makes some sense to spin that off, put it in the hands of franchisees, and let them take care of sales while the company focuses on manufacturing.

Then computers, the internet and cheap phone rates happened so OEMs can manage the data more efficiently than 2000 franchised dealers nationwide.
 
Decades ago Porsche decided to move to a model similar to Tesla's. They estimated that they could provide a much better customer experience, service, and cut the cost of the vehicle by 10 to 15 percent...Of course, just as with Tesla, they experienced fierce opposition to this from the dealership fraternity. After many years of battles, proposed legislation, and court fights, Porsche gave up. So, unfortunate though it may be, history is not on Tesla's side...
tesla has a way of making history obsolete. Remember when last successful launch of a new car company. Thank goodness they are not afraid to tackle precedents.
 
I think that the direct to consumer sales model is the only way small manufactures can survive. Why does Tesla need to adopt the dealership model even when they sell more vehicles down the road. No one likes the dealership model, and I worked for 25 years at that level and was lucky to work for a family organization in a outlying community. We needed to do it right as word of mouth was the way we survived. Things have changed over the years and so should the way cars are sold. Why cannot a very advanced electric vehicle be sold on line. We have the same issue with some states with direct to consumer wine sales. In this case it gets down to the powerful distributor lobby which has given lots of money to their politicians. We need to get into the 21 first century, when the customers complain thing change. If you have a product and people like it they will purchase and if they have a great experience they will tell there friends. If not, you will be out of business.
 
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