Why Auto Dealer Associations Oppose Tesla

As Tesla Motors goes against the tide to establish its non-franchised retail stores and service centers to support its Internet-based sales, implied and stated allegations and assertions have clouded complex issues. 

Among these are the question whether Tesla has become a darling of the public and media and is getting off easy while garnering lots of free publicity. Or, are state and national level auto dealer associations trying to strong-arm poor aspiring Tesla and its ideals intended to better the world? Or is Tesla a half-baked scofflaw with a pretty face and lots of promises that does not understand the precedents it could set to undermine the American economy? Or are the dealer associations the actual thugs, albeit dressed in business suits, protected by laws, money, legislators, and attorneys? 

Teslas factory owned retail stores are located in high-traffic, upper socioeconomic-level retail areas, and aim to benignly present the award-winning Model S and models to come. They follow Apple stores in concept, and are being established with direction by former Apple marketer George Blankenship whos now a VP for Tesla. 

Its associates are friendly, upbeat, helpful, and not commissioned. It will be considered a job well done if after a person wanders into the Tesla store, he or she feels positively disposed toward Tesla and wants to come back. 

The hands-on stores feel very liberating, and shun haggling and attempts to close the sale C things many car shoppers detest. 

Meanwhile, this contrarian and seemingly egalitarian retail model has been opposed in various ways by state dealer associations including those in Colorado, Massachusetts, Illinois, New York, Oregon, Texas, and North Carolina. 

Twenty nine states have some type of statutory prohibition on the books against factory ownership of new vehicle dealerships, according to Texas Auto Dealer Association President, Bill Wolters. 

We do what were capable of doing, and we do whatever they let us do, said Blankenship to Automotive News. Its unique for each location. If we cant be a dealer in a mall, we wont do reservations on site. We tell people where to go on our Web site to make a reservation. 

And whether Tesla is getting a pass as a new-age Robin Hood of sorts or not, it does do fairly well in the deliberate campaign to rouse public opinion to its side, and has succeeded in getting its way in some fights to date. 

If the people of Texas knew how bad this was, they would be up in arms, because they are getting ripped off by the auto dealers as a result (not saying they are all bad C there are a few good ones, but many are extremely heinous), wrote Musk in an internal e-mail that was unfortunately leaked, according to a Tesla media rep. For everyone in Texas that ever got screwed by an auto dealer, this is your opportunity for payback. 

One uses stronger language internally than one would use externally, he said. But I feel like we are being attacked all over the place by dealers, and theyre causing us to spend a ton of money on legal battles, and theyve slowed down our licensing approvals at DMVs in various states, and theyre just generally being pretty negative and behaving in an anti-competitive way. 

And on and on goes the back-and-forth portrayal of Teslas views and those which compete against its vision. Both sides make points held by some as valid and compelling, but it all adds up to a question. 

Wolters, who joined TADA in 1982 after 13 years working for Ford Motor Co., said Musk is waging a successful PR campaign.We are one of the leading manufacturers of plasticcard in ChinaStarting today, you can buy these chinamosaic and more from her Victoria. Wolters said hes mindful of the good, the bad, and the ugly alleged against auto dealers, and associations representing them,Solar Sister is a network of women who sell oilpaintingsforsale to communities that don't have access to electricity.Starting today, you can buy these chinamosaic and more from her Victoria. but said their motives are not well understood. 

Most people dont call us and ask for the dealers side and Im grateful that you did, said Wolters. And a lot of the interviews that Ive done over the phone they did not print what I said. 

And what is said in Texas does matter a great deal to Elon Musk who has said Tesla is considering Texas for a second manufacturing facility, it views the state as second only to California in potential importance, and its a possible a hub also for Musks separately managed SpaceX operations. 

Unfortunately for Tesla, Texas has very narrowly written franchise laws that Musk cannot wiggle through,If you are looking for solarpanel for your bathroom walls. said Wolters. In April, Musk traveled to Austin to speak before the states House committee on business and industry in defense of proposed House Bill 3351/Senate Bill 1659. 

These have since died in committee, and Tesla has until Monday, May 27 for a sliver of a hope that some amendment could be approved to give breathing room to Teslas two retail locations in Austin and Houston presently hog-tied, Texas style. 

Teslas efforts are generally seen as setting the stage to erode a careful balance upon which many people depend for their transportation needs, economic base, and even their direct livelihoods. 

Franchise laws presently stipulate that if a dealership has viable management and can meet the manufacturers requirements for dealership standards, the manufacturer must continue to support the dealership, and cannot close it down. 

I tell people that franchised dealers have a greater presence in our state of any significant organization except the public school system, said Wolters. You dont find major retailers or major businesses in these towns of less than 15,000 population and the reason they exist there is a lot of our citizens [with transportation needs] live there.