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Tesla Faces Tough Regulatory Hurdle From State Dealership Laws
First time accepted submitter vinnyjames writes "States like Arizona, Texas, Massachusetts and North Carolina either have or have recently added legislation to prevent Tesla from selling its cars directly to consumers. Now there's a petition on whitehouse.gov to allow them to sell cars directly to consumers." Laws that protect auto dealerships aren't newly created for Tesla, though, as explained in this interview with Duke University's Mike Munger.
I think we've just figured out what the next big thing is. Mercantilism should have disappeared centuries ago.
Tesla victory in NC
go figure...once they go on test drive....they love it.
It doesn't really matter since the federal government doesn't have jurisdiction anyway. It wouldn't be much different from the federal government telling states that they can't have their blue laws. In this case it just happens to be car dealers rather than bar owners.
I'd be the first to agree that the feds(the executive branch, no less, get your fucking civics in order, people...) are the wrong place to go; but I'd bet a nontrivial amount of money that the Interestate Commerce Clause is 'elastic' enough to handle this one, if Congress felt like it.
It would be bad form, and strikes me as unlikely to happen; but I suspect that if the feds felt like trying, they'd probably get jurisdiction.
There are two kinds of people in my town: those who work at car dealerships, and those who would rather go to the dentist than shop for a new car.
There are plenty of people who would like to purchase a Tesla if they had the means, and Tesla has lower-priced cars on their roadmap. Just because this wouldn't affect someone right now doesn't mean they shouldn't support it for when they need it. It's the "first they came for X, but I said nothing" scenario. Just because you're driving a gas car now doesn't mean you shouldn't support Tesla or any other EV maker. I'm sure the various auto dealer associations would love to get a bunch of laws passed in their favor before Tesla releases their lower-priced models in a few years. If you don't want to see that happen, then now is the time to speak up.
"Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
Impossible! North Carolina and Arizona, at least, are libertarian paradises - very "business friendly" - that would _never_ pass legislation interfering with markets or freedom to contract. Never! There must be some misunderstanding.
sPh
If a federal judge can strike down Virginia's ban on out-of-state trash processors shipping their trash to Virginia landfills, striking down barriers to Tesla selling direct to consumers across state lines seems like a no brainer to me. And I'm a states rights advocate.
Actually, this is probably a much better interpretation that would actually *FIT* under the interstate commerce clause than most other permissions extended since the 1830's
Michael J. Ryan - tracker1.info
Three things,
Middlemen don't like being cut out. those that try find themselves cut.
Manufacturers, factories, etc don't want the headaches of dealing with uniformed idiots. Ever work a computer Hell desk? yea that has been going on for as long as we have had machines. The average person is barely above being an idiot and half the population is dumber than they are. I have explained the same thing to the same person 30 times in the last 3 months she still doesn't get it. She can't open her mind up to possibilities other than what she already knows.
Lastly, Middlemen provide slack, and options for the supply chain. In today's tight supply chains they are even more important than ever. As if the factory doesn't have your part your stuck unless your lucky enough to have a middleman with extra.
i thought once I was found, but it was only a dream.
Typo... 74K short. Although now it's only 72K short, seems it's working...
If there's one thing business can't stand it's competition - given that the Big 3 conspired to kill the Tucker, you have some idea where the original legislation found its roots and monetary $upport (when it came to buying votes to pass the original bill). Every business would love to be a monopoly, barring that, they settle for an oligarchy.
A feeling of having made the same mistake before: Deja Foobar
Manufacturers, factories, etc don't want the headaches of dealing with uniformed idiots.
If manufacturers don't want to deal directly, they why do we need laws prohibiting them from doing so?
Middlemen provide slack, and options for the supply chain.
If middlemen really added value, then customers would be willing to pay for that value, without government coercion.
So, why not allow the option of middlemen, and the option of direct sales. If what you say is true then middle men will foster a better experience, capitalism will prevail, and companies dependent on direct sales will falter.
Right?
This signature is false.
And where was the political outrage towards Apple when they opened their own stores, for causing "unfair" competition with the other retailers?
(Obligatory computer analogy in this car thread.)
For all the times that we see the interstate commerce clause treated as a blank check for federal power, this is one time when it would actually be appropriate. Preventing one state from erecting barriers to trade with another is exactly what that clause had in mind.
Guess Washington is too busy regulating everything else they can see to even notice when an opportunity to wield power constitutionally comes along.
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The manufacturers of other cars have to sell through dealers because of these laws, and they don't want Tesla to have an advantage, and the existing dealers want a chance to become dealers for Tesla so they can get a share of that action.
The average person is barely above being an idiot...
I admire your optimism.
As someone who has actually bought a car from an out-of-state dealership and had it sent to me, I can say that not only is it legal, but that states have special forms of registration just for this purpose (I still paid registration fees in the state the car was shipped from, but they were very small and accompanied by a warning that'd I'd owe a fine if I tried to register the car in that state within a year).
Socialism: a lie told by totalitarians and believed by fools.
Thus the laws were originally intended to protect consumers on the local level. Now, especially in the face of subversive business models like Tesla's, matters have changed. Local dealers are in closer league with manufacturers, the latter often even providing financing for purchases. The arrangement is mutually beneficial: manufacturers can prevent upstarts like Tesla from getting a foothold in the market; dealers, acting as middle-men, can reap the rich benefits of rentseeking through powerful lobbies targeted toward state governments. N.b., however, this arrangement does not prevail in all states.
I really don't see how anyone can perceive this as stretching the ICC. This is precisely the kind of thing it is actually for! States are erecting unconstitutional barriers to trade of goods from other states, that's exactly when congress should invoke the ICC.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
If middlemen really added value, then customers would be willing to pay for that value, without government coercion.
Well, there are middlemen that add value, but they're not typical auto dealerships. They're facilitators that help you locate the car you're looking for. Many of them have agreements with dealerships that will get you the best price or near it without having to dicker, and you only pay a [relatively] small commission to the "dealer" that you're actually dealing with. This only really makes sense when buying a fairly new vehicle, otherwise the commission can be disproportionate. Of course, their value would fall without this sort of protectionist nonsense.
"You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
I think it's a typo for 'wins a kewpie doll'. Kewpie dolls are often given away as prizes at games of skill and chance at fairs and carnivals.
Scientists point out problems, engineers fix them
altslashdot.org: The future of slashdot.
You're definition of "logic" differs from common sense. The Constitution wasn't written to be subject to interpretation by arcane legal rules, but by citizens.
The SC has ruled that people aren't citizens because of the color of their skin (Dred Scott), that corporations are (Citizens United), and that personal crops are interstate commerce (Wickard v. Filburn). None of which stand up to plain reading or common sense.
The Supremes are in contempt of simple logic and common sense. They're illogical - as political as the Legislative and Executive.
The SC is the biggest flaw in our system - it should have consisted of a rotating chamber of state justices to provide a true "check and balance." The Feds deciding what the Feds can do is ludicrous.
"National Security is the chief cause of national insecurity." - Celine's First Law
So the argument against removing the laws (for all auto manufacturers) and making the dealers "sell" themselves to the auto manufacturers is what exactly? That dealerships lobbied really, really hard to sell you a product that they add no value to? Can you say "crony capitalism"?
Having purchased a Tesla Model S the experience is the exact opposite of when I purchased a Toyota. Tesla's showrooms do not sell cars. They show them. When I went to the showroom I could ask questions without any pressure to buy the car. The only way to buy a Tesla is on their web site so there's no sales critters trying to get a commission. There are a myriad of options to choose from which allows you to get the exact car you want. I got the paint color, interior color and all the options I wanted. It went to the point where I chose the wheel colors and whether or not to have a rear carbon fiber spoiler (I chose not to). There's also no haggling over price. Tesla basically builds to order without having to deal with an inventory of cars. You order your car and they deliver exactly what you ordered, or in my case I picked mine up at the factory and took the tour.
At the Toyota dealership I didn't have much choice. I could choose any car as long as it was on their lot, plus there's the high pressure sales. The only thing worse than one of their car salesmen is a used car salesman (which they also sell there).
Dealerships don't really protect the consumer. As far as I'm concerned, they're leeches. A relative of mine bought a Fisker Karma and the dealerships are basically helpless since Fisker is more or less bankrupt in all but name. The warranty is basically worthless as is any pre-paid service and parts are unavailable. Since Fisker laid off their engineers even support is limited even if paid by the owner. The dealership my relative goes to is better than many. Many dealerships completely dropped any and all support for Fisker so the owners are completely SOL. There's nobody to even perform routine service on the vehicles.
I groan every time I have to have something fixed that's not under warranty at Toyota. They charge a premium for the service since they know that with a Prius you're unlikely to take it elsewhere.
Dealerships also wouldn't make nearly as much profit on service either. Tesla has vowed to not make a profit on service, but then again, service should be a lot simpler than a gasoline powered car. There's no transmission to service or wear out, only a simple gear reduction. There's no 5K mile oil changes, the motor is lubricated for 12 years. There's no fuel pumps or spark plugs to replace.
Since the number of cars sold is fairly low, a dealership would also be selling o
Tesla service consists of a 12,500 mile inspection, replacing the wiper blades and brake pads if needed (brake pads should last basically forever), rotate the tires, replace the cabin air filter and possibly flush the coolant. Service also may include hardware upgrades, software upgrades are distributed over 3G and can be applied by the owner whenever it's convenient.
Tesla has vowed to not make a profit on service. When I broke one of the clips on my roof they had to replace the entire panel next to the glass sunroof. If the panel were on my Prius, the dealership would probably charge $200-300 just for a replacement panel plus a fortune in labor. Tesla charged me $100 and $175 labor to replace it, which after explaining what they had to do to replace it was a bargain.
Things are quite different now than they were in the 1950.
This post is encrypted twice with ROT-13. Documenting or attempting to crack this encryption is illegal.
I think of that fact every time I sit in a doctor's office. Half of them are below average, too. :-(
Yes. They are called general practitioners. The other half tend to specialize in higher paying fields, like surgery or anesthesiology.
For better or for worse, medical schools set their standards so high that only the most qualified (typically overqualified) ever get the opportunity to even study medicine, let alone practice. You may have a physician who was at the bottom of his class, but he's still likely to have more knowledge and intelligence than anyone else working or waiting in his clinic. It's not like IT, where there is a job for everybody, with a very wide spectrum of credentials or abilities (or lack thereof). Nor is it like those with a liberal arts degree, where employers just presume the degreed applicants don't know a thing about working life and have them start at the lowest position in the company, most often side-by-side with non-degreed hourly employees, and then only promote those noobs who show some potential to figure it out and actually make some effort to show up on time, properly dressed, and without a bad attitude.
Given that the student loans for the professions can easily top $100k, success is the only option. There is no bankruptcy allowed, and without a physicians salary there is little hope of ever having more than a Spartan existence, regardless of how earnestly one tries to pay off such loans by any other means.
Lets transpose tucker to today.
The consortium (a-pull, prounounced ahh-pull) took Tucker to court for patent infringement. A-pull stated that the Tucker breached many existing parents, including: 4 wheels, headlights, steering wheel, seats, brakes, windows, an engine, side mirror, ignition, the list goes on.
A-pull fanboys rejoiced when the courts upheld the 2013 verdict and sent Tucker corp bankrupt. "This is a win for protection of consumers", stated A Congress Member, when asked a about the outcome.
Sound familiar?
"Sound familiar?" Well ... no, it doesn't. Tucker won his trial, although he did go bankrupt. His trial wasn't about patent infringement, it was about securities fraud.
If it weren't for deadlines, nothing would be late.
And that's also precisely why they won't.
Anything that falls under "shit they SHOULD do" also usually falls under "stuff that will piss off special interests"
There is nothing wrong with the points you make. They are all good points. However, none of them is an argument that supports laws requiring a company to use middlemen.
The truth is that all men having power ought to be mistrusted. James Madison