Tesla's Next Auto-Dealer Battleground State: Georgia

cartechboy (2660665) writes [Elon] Musk and Tesla's biggest hurdle in the U.S. has been bypassing conventional dealerships and selling directly to customers. This concept is something that's illegal in many states thanks to a nationwide patchwork of decades-old franchise laws. Tesla's latest battle is taking place in Georgia where dealers allege that the start-up company is in violation of the state's franchise laws. Not surprisingly, Tesla's fighting back. To sell cars in Georgia, Tesla had to agree to sell fewer than 150 vehicles directly to consumers in the state. Last week the Georgia Automobile Dealers Association complained that Tesla sold 173 vehicles. Tesla hasn't publicly commented on how many vehicles it has sold in Georgia. We've seen time and time again how this story ends, and the writing is clearly on the wall for this case. Another bit of writing on the wall, though, as reported by the L.A. Times, is that recent electric car sales in the U.S. have been stagnant.

Comments

...really?

[Anonymous Coward]

cars people aren't allowed to buy aren't getting bought? whoda thunk it?

Re:...really?

[StripedCow]

Simple solution: they can see them in the showroom, and buy them online...

Re:...really?

[ShanghaiBill]

Simple solution: they can see them in the showroom, and buy them online...

Then you still need a showroom within a reasonable distance of potential customers, hundreds or thousands of showrooms spread across the country. That is not viable for a niche car company like Tesla.

Re:...really?

[Anonymous Coward]

You don't need a showroom in every city. One in each state, large city or major thoroughfares. Could be successful with a few hundred.

Re:...really?

[aviators99]

Simple solution: they can see them in the showroom, and buy them online..

This is already Tesla's model. You can't buy a car at the showroom; only online. Each showroom has at least one Mac you can use however you want, and an employee will help you if you have any questions. But you can't pay there.

Re:...really?

[mythosaz]

I imagine a lot fewer than that - or the number has to get a LOT higher.

After you sprinkle a half a dozen in California, it's about one per state in its largest metro area, and a few with one in their neighbors only. Texas, no doubt, could use a few, but the one large geographical states are pretty much centered on their largest cities. Las Vegas metro services 2 of their 2.7 million people, with only Reno left out of a showroom. Phoenix Metro does the same thing at a similar percentage, and while Tucsonians have to drive 2 hours to the current nearest Tesla dealership, it's not unreasonable for a $100,000 car. Denver Metro only covers half of Colorado's citizens, but, again, where else gets one if you don't have 500 dealerships?

Franchise laws = Racket laws

[Anonymous Coward]

There is no way in hell those franchise laws were put in place for the benefit of you and me. They were put in place merely to protect a lucrative profit stream for special interests.

Re:Franchise laws = Racket laws

[i kan reed]

"Special interests" is an obnoxious phrase purposely constructed to conflate issue groups that are mostly grassroots(on "both sides") with big money market manipulators who like having a senator in their pocket when they need one to make more money.

I'm not saying I like the influence of those issue organization, just that they're not greedy rent seekers actively harming others for their own benefit like the latter group.

Re:Franchise laws = Racket laws

[thaylin]

Originally they were not bad laws, back when there was only 1 or 2 car manufacturers who did not really have to compete, and when there were not many mechanic shops. Now the laws are really just a way to pay middlemen who pay lawmakers.

Re:Franchise laws = Racket laws

[Quince alPillan]

If you only read the laws themselves, you wouldn't think that. In theory, the laws are there to give you better service through a dealership because the evil large corporation gives you poor service at a steep price. They're there to prevent a monopoly on service so that you're not required to go to a Ford Garage so that a Ford Mechanic can fix your car with Ford Parts and price gouge the hell out of you.

In practice, they still do it and with the kickbacks and other ties to the parent company, they might as well be the same thing. The dealer ends up being the middle man that takes his cut and raises the price by thousands of dollars. The laws have effectively enshrined the dealership business model and Tesla threatens that.

Re:Franchise laws = Racket laws

[PhrostyMcByte]

Car franchise laws were put in place to protect dealerships. Car manufacturers did not want to put in the heavy local investment to sell cars in every area, and dealerships did not want a manufacturer swooping in to steal the business with lower prices once the areas started booming.

Re:Franchise laws = Racket laws

[Anonymous Coward]

If you only read the laws themselves, you wouldn't think that. In theory, the laws are there to give you better service through a dealership because the evil large corporation gives you poor service at a steep price. They're there to prevent a monopoly on service so that you're not required to go to a Ford Garage so that a Ford Mechanic can fix your car with Ford Parts and price gouge the hell out of you.

Which is currently the case with Tesla today. It has been backdoored to allow access to the local ubuntu X server which you can then do neat things like run a pidgin client or maybe add a gsm usb device and now you have a mobile hotspot. But Tesla doesn't let you do this unless you want to void your entire vehicle warranty. Better believe if these laws are revoked we, the consumer, will be the one to pay the price. Tesla's BMW's and the like will all gladly agrue DMCA for reasons why you cannot replace your wheels with non-factory wheels (you see the TPM devices are encrypted therefore no one can make a clone without violating the law).

We do not want to side with Tesla until Tesla provides us with the tools to modify our car.

Re:Franchise laws = Racket laws

[alexander_686]

It is a bit more subtle than that. Back in the 20s there were over a dozen auto manufactures and many repair shops, so that was not an issue. The issue was one of unbalanced power. The manufactures could bully the franchisors by forcing them to buy more cars than they could sell, yank their franchise after they had built up the brand and sell it somebody else, drive up franchise fees after the initial 10 year contract was over.etc.

A free market only works when there is a free exchange between 2 parties. The laws were supposed to, and did, redress this balance of power. Of course, what was true 100 years – or even 25 years does not necessarily apply today or to Tesla. The NADA today is about defending locally entrenched business interests and the status quo.

Re:Franchise laws = Racket laws

[bigpat]

Originally they were not bad laws, back when there was only 1 or 2 car manufacturers who did not really have to compete, and when there were not many mechanic shops. Now the laws are really just a way to pay middlemen who pay lawmakers.

I think that is probably backwards. These laws would obviously tend to help larger car companies exclude competition. Like many issues of regulatory capture I would deduce that these state franchise laws were actually bought and paid for by big companies like GM, Ford and Chrysler in order to ensure that all those smaller car companies that didn't have robust dealership networks would either be forced out of business or forced to sell out to the big three. It took some serious capital investment and many years to set up dealer networks for Toyota, Honda and other foreign car companies. But they had the backing of their respective countries and large consumer base at home to leverage. Make no mistake these laws may have been passed at the behest of the local dealers, but those dealers were working from the same game plan as the big three.

Re:Franchise laws = Racket laws

[westlake]

There is no way in hell those franchise laws were put in place for the benefit of you and me.

The auto and truck dealership began as a home town business, employer and taxpayer.

It typically offered a full range of vehicles appropriate to its market, argued for a better selection, and it could and did push back against the auto maker in ways an ordinary customer could not,

Re:Franchise laws = Racket laws

[ShanghaiBill]

Car franchise laws were put in place to protect dealerships. Car manufacturers did not want to put in the heavy local investment to sell cars in every area, and dealerships did not want a manufacturer swooping in to steal the business with lower prices once the areas started booming.

Franchise laws were not needed to achieve these goals. A far simpler solution would have been a contract between the manufacturer and the dealer, establishing the terms of the relationship.

Re:Franchise laws = Racket laws

[alexander_686]

It is not as easy as that.

First, it assumes that the two parties have relatively equal power, or at the very least that one can't bully the other. Second, it assumes the situation is static. This is rarely true after 10 years. After 20 years, normally the situation has changed so much that one party dominates and can squeeze the other party dry.

Re:Franchise laws = Racket laws

[CanHasDIY]

In my state, if you sell more than 5-8 cars a year, you have to get a dealers' license. Doesn't matter if they're old, new, salvage, etc, you hit that number, you'd better have a license from the state to sell cars.

Do I agree with the law? No, I think it violates the concept of free enterprise.

Is it the law? Yes, and in that every single person, corporate or otherwise, is required to follow it.

Assuming TFS is accurate (a dangerous assumption to make, I know), it sounds like the situation is thus:

- Georgia says, "if you sell more than X cars in this state, you have to have a dealership."

- Tesla responds, "OK, we'll sell less than X, so we can avoid that requirement."

So far, everything seems cool.

- GADA says "we're pretty sure Tesla has sold more than X cars, thus would be in violation of the law"

- Georgia asks Tesla, "How many cars have you sold in this state this year?"

- Tesla is thus far mum on the topic.

Again, presuming that this is a fairly accurate depiction of the circumstances... what makes Tesla the victim here? The fact that a competitor is claiming that they may have broken the law?

Re:Franchise laws = Racket laws

[ShanghaiBill]

It is not as easy as that.

Maybe not. But even if franchise regulations are needed (I am not convinced) it would make much more sense for them to say "If you are going to use franchises, you must do it this way" rather than to say "You must use franchises".

Re:Franchise laws = Racket laws

[Anonymous Coward]

Dude, buy a raspberry pi. It's cheaper. Who gives a shit whether you can run pidgin on your $80,000 car when you can do it on your $8 feature phone?

Re:Franchise laws = Racket laws

[davester666]

A whole bunch of dealers did get fucked over a few years ago...when the automakers went bankrupt, and as part of the process revoked a bunch of dealership licenses. It amounted to: the cars you have, you still owe us full price for, you have 30 or 60 days to sell them before you can no longer sell them as new 'brand' cars. Good luck with that.

Re:Franchise laws = Racket laws

[pedrop357]

What dealership? Tesla is not trying to court dealers and instead wants to sell direct. They wish to, as you put it, put in the heavy local investment and have no dealers that they could swoop in and steal business from.

Re:Franchise laws = Racket laws

[alexander_686]

I would take the opposite view. GM had a large number of inflexible costs. Old underutilized factories that they could not close, redundant union employees that could not fire, and a huge number of small unprofitable dealerships. The state franchise laws were so strong that the only way to fire these unprofitable customers was to dealer bankruptcy.
GM and Toyota have roughly the same market share but GM had twice as many dealers. In the 60s GM had over 50% of the market share, so it made sense to have 7 brands, and thousands of dealerships. Plus Americans were more rural and spread out. By 2010 having that many dealerships was irrational, but state franchise law limited what GM could do.

It made sense for the individual dealership to hold on – why give away a valuable franchise for nothing? And GM did not have the money to buy them out – even a marginal franchise is worth a million. But the collective actions were an anchor around GM's neck.

You could see GM moving in the right direction in 2000-2010, transforming themselves from a huge slow moving dinosaur into something for the modern age, but they just could not move fast enough.

Re:Franchise laws = Racket laws

[Anonymous Coward]

Yep.

The sad thing is, rather than pick and choose which dealers to shut down based on customer service or satisfaction, it was a ``your number is up, since you have to apply for renewal'' --- local dealer in business for about as long as GM sold cars was closed 'cause the owner passed away and the kids couldn't get a renewal on their dealer agreement.

Meanwhile, a dealership on the other side of town, which really should've been closed down due to low customer satisfaction and a high volume of complaints is still around.

Re:Franchise laws = Racket laws

[Anonymous Coward]

Agreed.

"If you use franchises in a region, you must define that region and as a car manufacturer you cannot back out of that arrangement".

The law should be written per manufacturer, rather than per sales-model.

(would probably need a follow-up law: "If you go bankrupt, and continue selling cars under a different brand you must offer a cost free side-grade of that franchise to an alternative brand name")

Re:Franchise laws = Racket laws

[Anonymous Coward]

A previous version of this article I read was this:

GADA says Tesla have sold 172 cars. between October 2013 and June 2014.

Tesla says: "We are allowed to sell 150 cars per calendar year".

So that's your answer, Tesla have sold 172 cars over the last 12 months, but not more than 150 cars per calendar year.

Re:Franchise laws = Racket laws

[Ol Olsoc]

.

You could see GM moving in the right direction in 2000-2010, transforming themselves from a huge slow moving dinosaur into something for the modern age, but they just could not move fast enough.

That's because of those ignition keys that kept turning the cars off.

Re:Franchise laws = Racket laws

[Ol Olsoc]

What dealership? Tesla is not trying to court dealers and instead wants to sell direct. They wish to, as you put it, put in the heavy local investment and have no dealers that they could swoop in and steal business from.

Amazing that so many of the states that believe in the free market and keeping Guvmint out of people's lives, feels the need to ban dealerships of a competing vehicle. I want to buy a Tesla. If I want to buy one in my own state, and cannot, well what kind of free market is that?

This tells me two things.

1. They are hypocrites.

2. They are losing this battle.

If no one wanted to buy Teslas, there would be no reason to try to ban sales of them in your state.

Re:Franchise laws = Racket laws

[Ol Olsoc]

There is no way in hell those franchise laws were put in place for the benefit of you and me.

The auto and truck dealership began as a home town business, employer and taxpayer.

It typically offered a full range of vehicles appropriate to its market, argued for a better selection, and it could and did push back against the auto maker in ways an ordinary customer could not,

And if it can no longer compete, it should go out of business. Too bad, its the invisible hand of th efree market.

Re:Franchise laws = Racket laws

[Anonymous Coward]

The combination of multiple, overlapping brands, and franchises who only sold a subset of those brands, was an albatross for the Big 3. These single-brand dealers (successfully) brow-beat redundant badge-engineering of redundant, overlapping models, across the Big 3's entire product lines. The dealers were short-sightedly attempting to avoid walking sales to cross-town competitors. Meanwhile, the badge-engineering diluted marketing resources across nearly identical models and eroded economies of scale due to pointless parts non-commonality. Chrysler was worst off in this regard, but was able to ditch (or consolidate) most of their single-brand franchises through their bankruptcy.

Re:Franchise laws = Racket laws

[Neil Boekend]

what makes Tesla the victim here?

The fact that the applicable law is idiotic.

That does not mean they don't have to comply. They should prove that they did not sell more than 150 cars.

Re:Franchise laws = Racket laws

[CanHasDIY]

what makes Tesla the victim here?

The fact that the applicable law is idiotic.

Well, OK, but technically that makes everyone the victim, not just Tesla.

That does not mean they don't have to comply. They should prove that they did not sell more than 150 cars.

Agreed; and if it turns out that Tesla was in violation of the law, Musk should consider shutting his mouth for once. After paying the fines and apologizing, that is. Otherwise, I'd say GADA should be the folks eating crow.

Re:Franchise laws = Racket laws

[dl_sledding]

Agree with most of your post, but you missed an important event. GM *forced* many of their dealerships to close, to reduce competition.

We had a very good GMC/Buick/Cadillac dealer here, and a crappy Chev/Pontiac dealer. GM told them that one of them was going to buy out the other, and gave them the opportunity to decide amongst themselves or GM would. As it turns out, the GMC dealer decided to sell out to the Chevy dealer (personal reasons: he was ageing, and none of his kids wanted to take over the dealership), and now prices have gone up, selection has gone down, and there's no "dealing" anymore: pay thier price or don't buy.

So, basically, GM removed the competition. At least, for it's own brands. So now there's a monopoly in this region and sticker price is where it's at.

They are stagnant

[geekoid]

because we(society) are in the post early adopter dip.

Re:They are stagnant

[0123456]

In other words, they're stagnant because only the fanatics have bought them, and the rest of us don't want them unless they're at least as convenient and cheap as a gasoline car.

I get about 30mpg around town, fill up with gas about once a month if I'm just doing town driving, have to drive at 40 below zero for two or three weeks a year, and make half a dozen five hundred mile highway trips every year. I have precisely zero reason to buy an electric car with current limitations and prices.

But, still, the franchise laws seem stupid and just another example of government pandering to business. I'd love to see Tesla get them kicked out.

Re:They are stagnant

[GodInHell]

One of the other articles on the L.A. times is reporting that "U.S. auto sales surge in August to month's highest level in years" so - it's lies, damn lies and statistics time. Electric car sales fell 0.1% as a proportion of total car sales during a period that included the car sales at the "highest level in years."

Consider also that Tesla is still on back-order status and they are gearing up to release two new models of cars. Other than the Tesla, only Nissan has a pure electric generally available on the market - the Leaf - which sold over 120,000 cars last year. See, Wikipedia. Ford's focus is also out there, but only in select markets.

Shorter: there's only one mass-market electric car on the market. The Tesla Model S, while definitely a beautiful car, doesn't have the production volume to compete in a market share battle - that's not Tesla's bag - yet. The "stagnation" story is more of the knee-jerk car guy rejection of electrics that has been bouncing around in the media for 30 years now.

Re:They are stagnant

[peragrin]

Or maybe electric cars are only for famines earning over 150k annually. No one else can afford to buy a car that is only useful some of the time.

I know one couple with a nissan leaf and a standard SUV. The leaf is use for around town driving and to get one of them to from work. The sub is for the husband and distance driving. 50-60 miles a day doesn't take you far.

Re:They are stagnant

[Mr D from 63]

Market share is stagnant, according to that description. Of course, the cost of Tesla limits it market to start with, even if they significantly increased sales it would not impact total EV market share that much. It does not take a huge number of sales for the upper end EV market to become saturated. Significant overall market share improvement can only be achieved with more products in the lower cost brackets, and that is where the total lifetime cost & functionality comparisons against gas cars become a lot more prevalent.

Re:They are stagnant

[geekoid]

No, that's not what I am saying.
With every technology, there is an early adopter, then a dip, then an increase. There are a number of reason for that. everything from cost or social perception or people just haven't thought about why it's good.

So your argument is current technology wont work for you therefore no one will get one?

Franchise law are there for a very good reason. Citizen were abused, cheated, and lied to pretty systemically. Fraud was rampant. That's why we ended up getting them in the first place.
Maybe they are out data, OTOH I'm not convinced all the former corruption and cheat wont return with other companies.
BTW, if they wanted to pander to big companies they would kill franchise laws. The auto industry sure would love to return to the 'we can do what we want and are not responsible ' days.

Re:They are stagnant

[Anonymous Coward]

This is purely anecdotal, but I live in Georgia and I see more and more Nissan Leafs in my area lately (west Metro Atlanta). Just a year ago, I'd see two different ones distinguishable by color alone: A black one and a silver one. These days, there are so many different ones on the roads when I drive, that I have to distinguish by the driver. I've seen at least two of each color Nissan offers, and some colors I've seen three different drivers.

My wife works for the tag office in the next county over, which serves an even larger, more metropolitan area than where we live. She has seen several dozen Nissan Leaf registrations come through in the past year, along with two Tesla Model S cars. The Telsa owners she described as being young, "hipster" type guys. The Leaf owners she has worked with were diverse, but skewed older generally.

Re:They are stagnant

[MMC Monster]

In other words, electric car sales are stagnant because of a supply problem, not a demand one. They can't produce more cars and they essentially are sold out months in advance.

As a proud owner of a Tesla (6 months and 15K miles so far), I can't imagine buying a non-electric car in the future. I live on the east coast and the supercharger network is built out around me well enough that I don't have any range anxiety at all.

Several friends are looking to see how I do this winter before putting money down themselves. A couple others already put down a ridiculous amount to be on the list to buy a Tesla Model X when it finally hits production.

Dealers should be concerned. If the big auto manufacturers go the Tesla way, dealers won't be making much in service contracts in the future.

Re:They are stagnant

[Xenolith0]

Other than the Tesla, only Nissan has a pure electric generally available on the market

That's not entirely true, currently available full EVs include the:

• Tesla Model S
• Mitsubishi i-MiEV
• Nissan Leaf
• BMW i3
• Ford Focus Electric
• Volkswagen e-Up!

That's not an exhaustive, but those are commonly available to buy today in the US.

Re:They are stagnant

[Khyber]

"I have precisely zero reason to buy an electric car with current limitations and prices."

"I get about 30mpg around town, fill up with gas about once a month if I'm just doing town driving, have to drive at 40 below zero for two or three weeks a year, and make half a dozen five hundred mile highway trips every year."

Sounds like you just aren't smart enough to properly utilize that which you're given. Your talk reeks of privileged trust-fund baby with only half an education.

Re:They are stagnant

[0123456]

Sounds like you just aren't smart enough to properly utilize that which you're given. Your talk reeks of privileged trust-fund baby with only half an education.

I believe the term for this is 'projection'.

If I was a 'trust fund baby', I'd be buying a $150,000 Tesla as a toy to impress my friends for a few days.

Re: They are stagnant

[Anonymous Coward]

You can't even configure a Tesla that costs 150k USD. Maybe if they were sold though a dealer network it would be that much in dealer added fees.

Re:They are stagnant

[AaronW]

I agree with you. I'm also the owner of a Tesla (18 months, 19K miles). Tesla is constrained by batteries. They can't make them fast enough. There's also a huge demand for the model X with thousands of pre-orders yet it is sight unseen. This is from a company that does no advertizing other than their showrooms.

Re:They are stagnant

[TomGreenhaw]

We've had our Model S for a year and a half. Last winter was one of the coldest in memory in Chicago.

Although the range was reduced somewhat, maybe 25% when it was super cold it was no problem whatsoever. Interestingly enough, the reduced mileage on our Mariner hybrid was about the same.

Re:They are stagnant

[Khyber]

Nope, still not smart enough to utilize what you're given, let alone see the advantages besides the obvious. That electric car could be perfectly usable, plus the times to recharge pretty much mean you can get much-needed rest instead of gassing up and getting right back on the road. Safer for you and everyone around you.

Trust-fund. Note how your response was to 'impress friends' rather than think of others. Self-centered, much?

You're having me on...

[Anonymous Coward]

"electric car sales in the U.S. have been stagnant."
 
"Tesla had to agree to sell fewer than 150 vehicles"
 
I don't think that is a coincidence.
 
Captcha: congest

Re:You're having me on...

[Anonymous Coward]

"Tesla sold 173 vehicles"

They sold as many as they could sell.

Re:You're having me on...

[thaylin]

You have no evidence of that. How do you know they did not realize the mistake after 173 and stopped?

Re:You're having me on...

[Mr D from 63]

Well, when we are dealing with needing sales in the hundreds, or at least tens of thousands to make a big difference in market share, a few hundred sales more or less in the narrow Tesla market would not be very relevant.

Re:You're having me on...

[pr0fessor]

Some of them may have also been out of state sales not sure how that would be handled, but going out of state to buy a car is not uncommon when looking for a specific model.

Ah, how heartwarming...

[fuzzyfuzzyfungus]

Do 'States' Rights' have any applications that aren't kind of embarrassing?

Re:Ah, how heartwarming...

[i kan reed]

Yes!

Some of them were outright morally repugnant, like slavery.

Re:Ah, how heartwarming...

[Anonymous Coward]

Medical marijuana. That's about it. Every other application has been to protect scoundrels (auto franchise law) or morally repugnant behavior (slavery).

Re:Ah, how heartwarming...

[Anonymous Coward]

> Do 'States' Rights' have any applications that aren't kind of embarrassing?

Of course not -- the reason why states rights make sense is because not all people in all locations want the same thing. In your state the laws that make sense are going to be viewed as incorrect in my state. Some people will think that's "embarrassing".

Recently we've been seeing news where companies with big pockets and long arms are going after all levels of government to get what they want, e.g. telecoms. In that negative-only light, yes, it would seem recently that states rights are only being abused. In the same light, so are federal and municipal entities.

Perhaps the question would be better reworded:
Do American politics and laws have any applications that aren't kind of embarrassing?

Re:Ah, how heartwarming...

[internerdj]

Yep. It is an availability bias. We only hear about states rights when in completely screws something up. You can't seriously say that a uniform code of law works best across the country, can you? What is best for California is best for New York? Or what is best for Arkansaw is best for New Jersey? Or what is best for Hawaii is best for Montana? Different attitudes, different resources, different population densitities. We are strong because we are different but united, granted when we screw it up the we screw it up monumentally.

Re:Ah, how heartwarming...

[GodInHell]

Pot legalization.

Re:Ah, how heartwarming...

[GodInHell]

That's not states rights. State's rights is the argument that the State's have the right to nullify federal law. You're talking about limit principles on federal power - different part of the constitution.

Re:Ah, how heartwarming...

[internerdj]

Well then there is a difference between the colloquial and the academic uses. That in itself is probably a big reason for the divide between positions on the issue.

Re:Ah, how heartwarming...

[CrimsonAvenger]

State's rights is the argument that the State's have the right to nullify federal law.

No, "States' Rights" is the argument that if the Constitution doesn't say the Feds can do it, and doesn't say the States cannot do it, the States get to decide whether to do it or not.

Stagnant electric car sales

[guruevi]

The reason they're stagnant is because there is only one brand worth buying them from is Tesla.

Toyota/Honda has a decent lineup in the upper range with their plugin hybrids but if I'm going to plunk down 50k, it might as well be a Tesla or I can get a gas powered car with identical economy for half that price from better brands.

Perhaps one of the Germans will start entering the market with a better option but the Chevy Volt is crap, Ford and Fiat publicly state they rather don't do it, Fisker was legislated out of business, the rest of them are simply putting in a model because they have to and it shows; it's the same frame as a gas powered car with some batteries slapped into it.

Re: Stagnant electric car sales

[AvitarX]

The leaf is a reasonable attempt I the no, pricey for what it is, but seems an honest attempt.

Re:Stagnant electric car sales

[i.r.id10t]

The Porsche 918 is gonna cost you a whole lot more than $50k

But for $50k you can get a 356, 912, 914, VW Bug or Bus - anything that takes a 200mm clutch, and convert it to battery power from a few different vendors, and still have money left over (maybe, depending on which car you are using as your host).

Re:Stagnant electric car sales

[Anonymous Coward]

Mercedes and BMW are already in the American market and VW is going to be in the next 2 years. You obviously don't keep up with what is happening in the EV world much aside from the never-ending Tesla circle jerk here on Slashdot.
 
Maybe the numbers wouldn't be so stagnant if you guys who cried years ago while watching Who Killed the Electric Car would just go out and buy what's out there today instead of using the hideous fanboy excuse of "I'll buy a Telsa when they come down in price."

Re:Stagnant electric car sales

[ffsnjb]

Have you driven a Volt? I own one, I'd like to buy a second. Best car I've ever driven, with the exception of a Countach I had the pleasure of a couple miles in.

Re: Stagnant electric car sales

[Anonymous Coward]

The leaf is a reasonable attempt I the no, pricey for what it is, but seems an honest attempt.

The problem is they're two different market segments. The Leaf is an honest attempt to build an electric car. It gets you from A to B, looks kinda cute, and RUNS ON ELECTRICITY NOT GAS! You're saving the environment! (But you could do that in a Prius, Fit, or any other subcompact.) The Model S and the Roadster are electric cars. They accelerate faster than a Lamborghini Countach, look totally badass, and, oh, by the way, they just happen to run on electricity, not gasoline. You're feeling awesome whenever you come up to a metered highway entrance because you get to go from zero to sixty in five seconds! (And there are still relatively few cars in which you can do that and save the environment.)

Re: Stagnant electric car sales

[Anonymous Coward]

I went shopping around this year for a car so I do know what's out there. The VW Golf was available but that's a bit too small as is the Leaf - I need a small sedan at the least. The Altima and Accord plugins were great but they came in at $50k; the Tesla comes in at ~70k if I'm not mistaken. The Jetta/Passat Turbo was half the price and has nearly equal gas mileage to the Accord/Altima.

BMW and Mercedes' options had worse range, worse mileage and were ending up more expensive than the Tesla once all the nickel and dining was done. Chevy Volt and Ford Focus are a joke, 100 miles range on a non-hybrid?

Re:Stagnant electric car sales

[Overzeetop]

It's be nicer if it didn't look like it was styled after a 1970s movie prop. It's one of the biggest problems with most electric cars (and many hybrids) - they look like someone from Disney's Imagineering division was tasked with designing a style that would fit into the World of Tomorrow. Why can't they just look like a car? (and before you claim aerodynamics, the same argument can be made for an ICE car and yet nobody worries about those last few percent on those)

Re: Stagnant electric car sales

[Khyber]

"(And there are still relatively few cars in which you can do that and save the environment.)"

Uhh, you do realize that power for the EV has to come from somewhere, right? And that you've introduced a second losy step in conversion to electricity, right?

Save the environment my ass until it's full solar.

Re: Stagnant electric car sales

[Moof123]

I can't disagree with anything you said. The Leaf is a good little second or third car. I use mine as my daily commuter, usually 15-40 miles a day, and we use it for most of our driving on weekends. It easily gets used for >50% of the miles in the house. But the range just doesn't cut it for about 10% of the trips. It is actually rather fun to drive, but only once you get good at ignoring all the whirly gigs warning you about how much energy you are wasting and the completely bogus range estimator.

If they can get the real range up to 150 or 200 miles it will be vastly easier to own a car like the Leaf as your only car. Only a couple percent of trips would be out of that range for almost anybody, and then renting using things like a Zip car makes good sense for the few long trips you take per year.

Tesla has a great car, and has suffered some bugs from being their first full fledged car. $70-90k just makes it an absurd proposition for most folks. I got my used leaf for $15k, which will pay for itself in about 40k miles compared to driving my truck, so it was a no-brainer.

I am hopeful that within a few years we will have a longer range Leaf, and a cheaper Tesla to provide 2 good options in the $35k ballpark. Just as important, it would be nice to see the charging infrastructure get figured out, too many companies with too many hair-brained plans are a real turnoff to trying to do a road trip (AeroVironment chargers for example require a monthly plan, or to call to access them every time, wtf?).

Re: Stagnant electric car sales

[Anonymous Coward]

losy step in conversion to electricity

burning gasoline in a power plant, transmitting it to a tesla and using it translate into MORE miles per gallon than using the gasoline in a comparative size internal combustion engine car, because such engine is horribly inefficient.

Re:Stagnant electric car sales

[PRMan]

The Mercedes CLA has the lowest coefficient of drag of any car and it doesn't look ridiculous.

Re: Stagnant electric car sales

[AvitarX]

I agree, I just wanted to point out it wasn't only Tesla taking it seriously. I think Tesla is smart in marketing to the only segment where you can build a truly compelling car as you put it. The issue with a Leaf vs a hybrid is that if you drive enough for the fuel savings to be relevant, the Leaf's range is going to be very limiting.

I'd still contemplate the Leaf in it's cheaper years (it's price fluctuates a good deal) for a primary car, allowing myself to have a big guzzler too, for long trips, and hauling stuff.

Even so though, second insurance would probably make it more expensive payments aside.

Re: Stagnant electric car sales

[Anonymous Coward]

They accelerate faster than a Lamborghini Countach
 
True but so will a Subaru Impreza. In fact, not until you get to the Tesla Performance model does the Tesla accelerate faster than a Subaru WRX and the Scooby also wins in the area of the quarter mile on other non-Performance Tesla S models. It's really not that impressive. In fact, I expect it to be at least that good considering your little wiener extender costs more than 3 times more than the WRX. If that's what you need to feel "badass" you can have at it. And to think that people around here laugh at people paying a couple hundred extra dollars on an Apple tablet. SMH.
 
So once you get past your macho fantasies fueled by whatever car poster you had on your wall as a teenager... the Tesla just isn't that impressive aside from its range as an EV. Even that's nothing to write home about as the Nissan Leaf's battery weighs a little bit less than half the weight of the Tesla Model S 60 and gets just a little less than half as many miles. It seems that all Tesla is really doing is cramming more battery in there to get the range. BMW's i3 has a better weight to mileage ratio than the Tesla.

Re: Stagnant electric car sales

[Anonymous Coward]

A typical, gasoline-powered, automobile engine runs less clean than a large-scale electric power-plant per unit of energy produced.
A typical, gasoline-powered *car* is roughly 15-20% efficient from Fuel to Road. (Only 15-20% of the energy released from the fuel results in moving your car, the rest is lost as noise, friction, heat, vibration, etc.)

An electric car requires less fuel to be burned to provide the same motive power as a gasoline (or diesel) automobile. At the same time, the fuel burned to generate electricity is burned in more efficient, and cleaner ways, and more of what waste there is can be captured, rather than being released into the environment.

Electric cars are *much* better for the environment than fossil fuel powered cars.

Re: Stagnant electric car sales

[rsborg]

If they can get the real range up to 150 or 200 miles it will be vastly easier to own a car like the Leaf as your only car.

This. I commute several days a week nearly 40mi each way. While that is technically within the capabilities of the Leaf, and I do have a charging station at work... the problem comes with the fact that a) if the range drops off from the reasonable estimate (i.e., I drive much faster than 55mph or the car loses range with age) or b) if I don't get a charging spot at my work parking lot, then I'm at risk of being stranded on the highway.

Right now I drive a 10 year old Prius, which does OK for mileage (50mpg average). A Leaf or a Volt seem like lateral upgrades, while a Tesla is exactly what I'm slavering over. I just can't ... justify the cost - my Prius while enviable 10 years ago - is still a souped up econobox type car, but it simply won't die. I fully expect it to last another 5-10 years. Hell, I haven't replaced my original brake pads,

Re:Stagnant electric car sales

[ffsnjb]

Other than the rear deck height being higher than the front, I don't notice many drastic styling differences from a Cruze, Malibu or Impala. The height difference is the consequence of the Volt technically being a hatchback, so it doesn't really bother me. If you were talking about the styling of a Leaf or iMiEV, I'd be inclined to agree, which is one of the reasons why I don't own either of them.

Re: Stagnant electric car sales

[Khyber]

Transmission losses.

Line losses.

Conversion losses.

Charger losses.

Heat loss coming from the battery as it charges + energy lost making hydrogen during the charging process.

And much more.

Do the math, see that you're wrong.

Re:Stagnant electric car sales

[Anonymous Coward]

Um, the Leaf is built on the same chassis with nearly the same body as the Nissan Versa (ICE). So I'd say you're dead wrong that the EV aspect of the Leaf is the reason it looks the way it does.

Re:Stagnant electric car sales

[ffsnjb]

I didn't imply that I dislike the Leaf styling just because it's an EV. I also dislike the Versa, because the one that I've driven (coupe, not the hatchback) was a horrible experience and looked about as awesome (/sarcasm) as my 2001 Mitsu. Mirage.

RE: Electric Car sales.

[Anonymous Coward]

My local dealers in Georgia do not carry electric cars. To get an electric car you have to order it through them (if their manufacturer actually makes one) or buy online. In other words, car dealers are hurting electric car sales.

I hope Tesla is successful. Car dealerships are an anachronism and offer no value to the consumer. They are just needless friction in the car market and just adds expense and bullshit for us consumers.

Small government

[Anonymous Coward]

Isn't Georgia one of those "small government" red-states? How's that working out?

Re:Small government

[Mycroft-X]

Well, actually it had an uninterrupted string of Democratic governors from 1872 to 1999.

http://en.wikipedia.org/wiki/List_of_Governors_of_Georgia

Re:Small government

[Gim Tom]

Isn't Georgia one of those "small government" red-states? How's that working out?

Oh, yea... And we are also one of the most corrupt states too! The Attorney General was fined this week for withholding evidence in an ethics case that might have implicated the Governor.

Re:Small government

[thaylin]

Democrats from 1872-1950s are the current republicans, founded by southern democrats of the time who disliked the north democrats policy to not fight, but accept the decision.

Re:Small government

[peragrin]

It gets better when you realize Texas has had more democrats as governors than California

Re:Small government

[Mycroft-X]

So what you're saying is that when describing the democrats in office from the 1950s onward, when these franchise laws were made, the term democrats is consistent with today's usage? What a twist!

Stagnant

[Anonymous Coward]

Yeah, because aside from the uberdollar Tesla Model S there really isn't anything out there that is significantly different then there was 4 years ago. All the EVs are still in this 80-90 mile range unless you got the bucks to buy the Tesla. In a couple years this is going to open up more. Nissan is planning a higher range Leaf and Tesla has some stuff out there for a lower priced EV with (speculated) good range.
 
I want an EV but I can't do the 90 mile thing. I have a single trip I take about once a month as part of my job that is 107 miles round trip. What day this trip happens on isn't planned and under the right circumstances I may have to take it at a moment's notice. There are charging stations on the way to and from but my current ICE is running well although I'm starting to see the signs that it only has a good 3-4 years left in it. If it were to die today I'd still love to go to an EV but I know that I would be hard pressed as I'd be kicking myself when the new generations of EVs come out. If I could get a Leaf with a solid 120 mile range I'd jump on it the next time my current ICE needed anything that was over a few hundred dollars in repair.
 
The technology just needs a bit of time to mature and we're already seeing the light at the end of the tunnel. The sooner the better, AFAIC.

Re:Stagnant

[CaptSlaq]

I certainly hope that Nissan will release the sport version of the Leaf they built... The Leaf Nismo RC. Looks so much better, and they relocated the drive system to the back wheels, where $DEITY intended. Put a reasonable interior and battery in it, offer it for $30ish... I think there's a market for it.

Re:Stagnant

[tepples]

If it's only once a month, why not own an EV and rent a fossil burner?

Re:Stagnant

[Anonymous Coward]

Because I literally can be sitting at my job right now and be asked to make the trip with the expectation that I would be there within an hour. If I could pre-plan this I know of an ICE I could borrow once a month for the trip without going to the rental.
 
As I said, if my current ICE bites the dust today I may still go to an EV but for today it's a hard call to make. Hopefully in 2 years it'll be obvious that the EV is the way to go.

Re:Stagnant

[drinkypoo]

Because I literally can be sitting at my job right now and be asked to make the trip with the expectation that I would be there within an hour.

Ugh, in your own car? Talk about a business process designed for failure and liability. The business needs a vehicle, with a solar fan/battery minder.

Re:Stagnant

[Clomer]

Well, if your current ICE does last 3-4 years like you hope, maybe you'll be able to replace it with a Tesla Model 3. 200 miles of range, base price of $35k, expected release in the 2017-2018 time frame.

I'm actually in a similar situation - my car is showing signs of age, and while it is running fine now, I can't be sure how much longer it will. Most of my daily driving is under 30 miles, so a Nissan Leaf would do the majority of the time, however once a month I take a trip that is about 100 miles round trip. Granted, unlike you, it's generally pre-planned (I actually have one tomorrow), but it's often enough that the idea of renting a car whenever I do it sounds like too much of a hassle. Also, since my 30 miles of normal driving still happens on those days, an EV has to have a minimum of 130 miles of real world range before it is even an option. To be an option I'll consider, 200 miles is minimum to cover those one-off cases of needing to go even further.

The Tesla Model S is currently the only option that meets that requirement, but it's far too expensive for my budget. That said, I have high hopes that the Model 3 will be my next car.

Re:Stagnant

[Anonymous Coward]

Ugh, in your own car?
 
Yessir. On the upside, I get 45 cents per mile. Working out the numbers on the back of an envelope I figure it costs about 38 cents a mile to pay for my car for the first 100k miles plus the price of the car itself. So I'm kind of making out a little on the deal as I'm now over the 100k mile mark and my car is paid off.
 
  Talk about a business process designed for failure and liability.
 
Being able to travel is a known requirement for my job and while I'm traveling for the company both me and my car are covered by the company insurance policy. I agree it could still be better with a company vehicle but I knew what I was getting into when I got into it.
 
  The business needs a vehicle, with a solar fan/battery minder
 
We do have a mini van but I have to schedule its use and it's not always available.
 
I know it sucks having this one little hitch that is keeping me from an EV but, as I said in my OP, it's still a technology that needs a bit of time to mature. I don't think it's realistic to have a larger EV community at this time given some of the limitations and the fact that an auto kept in good maintenance should last roughly 200k miles today. I'd like to think that there are people like me out there who are ready for the EV but circumstances keep them from it. Hopefully the most outstanding circumstance is not wanting to trade away a perfectly good car that still has a lot of miles to go on it.

Re:Stagnant

[Khyber]

Might as well keep an EV and have it plugged in at all times. No gas charges, but still paid mileage? Sheeeeeit.

Re:Stagnant

[tepples]

Can you drive an 80+ mile EV there, charge it there, and drive back?

Re:Stagnant

[Anonymous Coward]

Well, one of the unfortunate circumstances that may arise that would make me drive there in a moment's notice is a power outage. :/

Re:Stagnant

[Anonymous Coward]

Ugh, in your own car? Talk about a business process designed for failure and liability. The business needs a vehicle, with a solar fan/battery minder.

Wow, you're so smug that I can actually smell your rosy farts through the monitor. Could you please tell us next about how you don't even *OWN* a TV and how eating a gluten-free organic vegan diet is the ONLY way to eat? I mean, I just want you to complete the stereotype.

So much for less government regulation

[smooth wombat]

Isn't Georgia one of those states where a majority of the folks rail against government intrusion and regulations into the private sector?

Must be nice to talk out of both sides of your mouth. Maybe they should get a gig as a sideshow freak.

Re:So much for less government regulation

[tomhath]

You raise a good point. Perhaps there's a reason people are railing against the intrusive regulations that were signed into law by Gov. Roy Barnes (D) in 1999?

Re:So much for less government regulation

[Anonymous Coward]

Is that continuance of ownership policy why they're referring to conflicts started by the previous administration as "Obama's wars?"

Re:So much for less government regulation

[Anonymous Coward]

The business lobby is very strong here.

And most of my neighbors vote on "social issues" - anti-gay, anti-abortion, things like that. Many of our candidates are so openly religious that it's like living in a Middle Eastern Theocracy and it's really creepy - see the billboards on I-75 in southern Georgia sometime. It's not so bad in Metro Atlanta but if you're not openly Christian, you're screwed.

Anyway, at least from Georgia, expect the same assholes in Congress and maybe some more in November because the Republicans got most of this state by the short hairs and they are the incumbents. And everyone in congress is an asshole except for your guy, it seems.

Re:So much for less government regulation

[Anonymous Coward]

Isn't Georgia one of those states where a majority of the folks rail against government intrusion and regulations into the private sector?

Must be nice to talk out of both sides of your mouth. Maybe they should get a gig as a sideshow freak.

I know very close to nothing about Georgia or the politics involved, but going by what you just wrote:

(1) Georgia is one of those states where a majority of the folks rail against government intrusion and regulations into the private sector
(2) In Georgia, government intrusion and regulations into the private sector happens too much

From this you conclude that the majority in Georgia are talking out of both sides of their mouths? Wouldn't it make sense to say that they're right and, if anything, should be railing even harder until the government intrusion backs off?

Stagnancy bogus. Math is hard.

[Jodka]

from the summary:

"...as reported by the L.A. Times, is that recent electric car sales in the U.S. have been stagnant"

from the LA Times:

"Sales of electric drive vehicles are stuck at about 3.6% of all new car sales for 2014"

"And that's during an otherwise robust sales season. Total figures for August were higher than any time in the last decade."

So the absolute number of electric car sales is increasing but their market share is not. The reporter, one "Charles Fleming," seems not to comprehend that a fixed percentage of an increasing value is itself an increasing value. "Stagnant," is the wrong term to describe an increase in sales. Math is hard.

Re:Stagnancy bogus. Math is hard.

[Anonymous Coward]

So the absolute number of electric car sales is increasing but their market share is not. The reporter, one "Charles Fleming," seems not to comprehend that a fixed percentage of an increasing value is itself an increasing value. "Stagnant," is the wrong term to describe an increase in sales. Math is hard.

No. Charles Fleming like everyone else on the planet, except it seems you, understands that selling more cars simply because the demand for cars has increased, is not a measure of success in any way, shape, or form, whatsoever.

What is the Tesla strategy?

[dtjohnson]

(From TFA): "Musk and Tesla's biggest hurdle in the U.S. has been bypassing conventional dealerships and selling directly to customers. "

I don't get why Tesla's biggest hurdle to sales is bypassing conventional dealerships. It seems like their biggest hurdle would be to convince people to purchase a new type of vehicle that had different advantages and disadvantages than anything they had owned before. The linked article on the slowing sales of electric vehicles also refers to that when it mentions that 'the numbers don't pencil out for many purchasers.' So why is Tesla focusing so much energy on getting rid of car dealerships? Couldn't they allow 'Tesla' franchise dealers to sell cars? Wouldn't that result in more retail outlets for Teslas? Wouldn't that result in more places for Tesla owners to go for repairs and parts and wouldn't that result in more people working indirectly or directly to make Tesla a success? Maybe a few dealer salespeople would be able to show buyers how the numbers do pencil out. What am I missing here?

Re:What is the Tesla strategy?

[hansoloaf]

Because: 1) Dealers sell more than one brand. They will steer the buyers towards other brands if the buyer is hesitant about Tesla. Dealers don't care about one brand loyalty - just want to sell as many as possible in a month. 2) Dealers will definitely try to sell more gas cars as they break down more frequently and the $$$ for dealers is the service dept. They barely make a profit in the sales dept. 3) Tesla has a specific idea on how to do customer experience. Dealers are the worst in this category. Tesla wants to avoid this.

Re:What is the Tesla strategy?

[drinkypoo]

I don't get why Tesla's biggest hurdle to sales is bypassing conventional dealerships. It seems like their biggest hurdle would be to convince people to purchase a new type of vehicle

That would be difficult, but an EV is not a new type of vehicle. It's at least as old as the ICE-powered car.

that had different advantages and disadvantages than anything they had owned before.

But see, that's the point of Tesla. People have been clamoring for a vehicle which has those specific advantages, and they don't care about the disadvantages. There's plenty of people for whom the range is simply not an issue. If they need to go farther, they'll have their driver take them in their A8L or long S-Class, or they'll take a black car service or limo service — perhaps to an airport. I mean, we are talking about people who can afford to dash off $70k+ for a car that is not all things to all people. These people are far from broke and they can probably write all of this off, anyhow.

So why is Tesla focusing so much energy on getting rid of car dealerships?

That's an incredibly biased way of putting it, and in an incredibly bullshit way. It's the car dealerships (and their paid officials) which are putting the energy into preventing Tesla from selling cars directly, in a free-trade kind of way.

Re:What is the Tesla strategy?

[ksheff]

They can sell more than one brand, but what's stopping someone from setting up a dealership that sells only electric cars and installs & services the home charging systems?

Re:What is the Tesla strategy?

[MMC Monster]

But see, that's the point of Tesla. People have been clamoring for a vehicle which has those specific advantages, and they don't care about the disadvantages. There's plenty of people for whom the range is simply not an issue. If they need to go farther, they'll have their driver take them in their A8L or long S-Class, or they'll take a black car service or limo service — perhaps to an airport. I mean, we are talking about people who can afford to dash off $70k+ for a car that is not all things to all people. These people are far from broke and they can probably write all of this off, anyhow.

You should take a look at the Tesla forums. Specifically: http://www.teslamotorsclub.com...

Poor guy bought a BMW electric car and was informed by the dealer that he can use any charging stations he saw on his phone app. The dealer didn't educate the purchaser about charging stations appropriately and the guy didn't have a proper charging port in his garage. The guy bought the car because he listened to what the dealer said and didn't do much independent research.

Fuck dealers.

Re:What is the Tesla strategy?

[bigpat]

What am I missing here?

Probably a truck load of laws and regulations in each state that raise the costs and barrier to entry for new car dealerships.

Re:What is the Tesla strategy?

[Anonymous Coward]

2) Dealers will definitely try to sell more gas cars as they break down more frequently and the $$$ for dealers is the service dept.
 
Really? Maybe I'm atypical but I've spent less on ICE-only repairs and maintenance to my 8 year old/125k mile car than the replacement cost of a battery pack in a Nissan Leaf or the cost of Tesla's recommended maintenance plan*.
 
  Tesla has a specific idea on how to do customer experience. Dealers are the worst in this category. Tesla wants to avoid this.
 
They're fools in that case. You're asking someone to pay a premium price for a car that they can't easily go out and kick the tires on? If I get an itch or a need to find a new car this weekend I can got to dozens of places within 20 miles of my home. I can haggle and test drive. I can decide to go down the street to another dealer if I feel I'm being mistreated. For me to get a Tesla today in a state that is friendly to Tesla would take what exactly? From the consumer aspect I have a website that recommends a Tesla "Store" (sounds like a dealership to me, Vern!) that is nearly 300 miles away and I can't expect delivery until November if I place my order today. So even if I show up with cash in hand I'm still SOL when it comes right down to it.

* If you didn't pay attention to the small print on Tesla's page; The cost of an eight year service plan is 5700USD. Not subscribing to this plan may well void your warranty. I'm wondering if I need to take another 300 mile trip out to the Tesla "Store" just to have this service done every 12.5k miles... Fantastic!

Re:What is the Tesla strategy?

[j2.718ff]

2) Dealers will definitely try to sell more gas cars as they break down more frequently and the $$$ for dealers is the service dept. They barely make a profit in the sales dept.

Whether a dealer is actually thinking in those exact terms or not, the fact is, they'd need to do some major re-work of their service department. All gas-engine cars are quite similar, and thus the same mechanic can work on most of them without much trouble. But a Tesla has some major differences that would require some significant training, and probably a number of new tools to work with them. This makes me think dealers would be either less willing to service Teslas, or would cut corners in doing so.

Re:What is the Tesla strategy?

[Moof123]

It is hard to build your brand image when a bunch of lying greedy a-holes are your main contacts to the public. Dealers are going to take a ~10-15% cut as well, which makes an already expensive alternative that much worse. For a new brand to jump directly to the dealer model is a huge hurdle.

The real question is when the other brands are going to make the plunge as well. If Tesla manages to get their model to stick well enough in a bunch of states you can bet that at some point an automaker that is already on the ropes (*cough* Chrysler *cough*) might get desperate enough to try and bypass their dealers to gain a cost edge that might make the difference between survival and not.

Re:What is the Tesla strategy?

[PRMan]

And Teslas have virtually no repairs. Everything is supposed to last 5-10 years.

Re:What is the Tesla strategy?

[King_TJ]

I could be wrong, but I doubt the Tesla strategy is quite what you've stated?

At best, it might be ONE factor supporting the strategy. But I think the *primary* motivation of doing their own sales and bypassing dealerships is simply cutting out the red tape and middle-men.

The fact the dealers sell more than one brand seems pretty irrelevant in the grand scheme of things to me? First of all, most dealers have used cars lots that carry whatever they get in trade to resell. That will include Tesla vehicles in the mix, as they get traded in -- and Tesla has no way to prevent that. But beyond that? Most dealers still only carry 2 to 3 brands, at most, of new vehicles. Customers tend to have a good idea what they want before setting foot on the dealer lots, and select a dealership they know carries the brand they're thinking about buying. I'm sure it happens, but I've never witnessed someone go into, say, a "Hyundai and Suzuki dealership", looking at Hyundai, and have a salesman talk them into one of the Suzukis instead. Most of the time, the dealerships are even designed so the different brands they sell are partitioned off into different areas of the building, giving you the feeling you've stepped out of one business and into another as you cross over to look at the other brand. It's not really conducive to encouraging you to ping-pong between the brands while shopping.

Personally, I love what Tesla's trying to do! But just saying, I think it's more about retaining full control of the sales and customer service experience than it is a concern that traditional dealerships will steer interested buyers towards gasoline powered competitors.

Re:What is the Tesla strategy?

[Anonymous Coward]

Because dealers would take a cut, making the cars more expensive therefore less likely to be bought. A big part of Tesla's strategy for selling cars despite the high cost is selling them differently - positioning the vehicles as an image thing rather than a transportation commodity plus cutting out some middlemen.

Re:What is the Tesla strategy?

[Anonymous Coward]

I'm guessing you haven't looked into Tesla's service plan yet, have you? Or are you another one of the masses who believes that once you jump into an EV you pay for nothing aside from brakes, tires and electricity until the battery dies? Tesla's service plans are steep in price. Go to their own page and check it out. This isn't the maintenance free paradise that so many keep acting like it is. Dealerships would kill to have this kind of guaranteed income with each sale in the name of maintenance.

Re:What is the Tesla strategy?

[vux984]

All gas-engine cars are quite similar, and thus the same mechanic can work on most of them without much trouble

Parts are not interchangeable, and the more brands you service the wider your parts inventory has to be. Sure they all order in for the major stuff, but at least the most common regular consumables have to be on hand.

And experience is very vehicle specific. If you know how to change a clutch in a VW Jetta that doesn't mean you know how to change a clutch in an Ford Taurus.

The principles are the same, but if you work on VWs all day, you'll almost know by muscle memory what exactly needs to be removed in what order, what bolts are where, what else should be checked while you are "in there", etc. Switch cars, sure you can change a clutch but it will take longer and be less efficient.

But a Tesla has some major differences that would require some significant training, and probably a number of new tools to work with them. This makes me think dealers would be either less willing to service Teslas, or would cut corners in doing so.

Definitely agree. But one would think the same would be true of a dealer servicing the Nissan Leaf etc.

Re:What is the Tesla strategy?

[stephanruby]

2) Dealers will definitely try to sell more gas cars as they break down more frequently

Well, technically the perception is the opposite, that electrical cars are not proven on the road yet. That is why Tesla is required to give out free lengthy warranty support, since they want to gain the trust of their initial customers.

And that's probably why, as you've already said, and which I completely agree with, that dealers are not going to make money for providing over-priced maintenance & repair services (since Tesla is going to be the one mostly footing the bill).

Re:What is the Tesla strategy?

[Anonymous Coward]

First - I don't think dealerships are a hurdle to sales - currently supply is the hurdle, and eventually it will be price. However, dealerships are a hurdle because there are plenty of strategic reasons that Tesla doesn't want to be forced to have dealers:

1) The overhead that dealers add to cost - electric cars are mostly fighting a cost game vs. gasoline cars. If you can cut 10% off the top of your end consumer pricing because dealers aren't taking a 10% cut, that just made you 10% more cost competitive vs. ICE.

2) There is a lot of infrastructure / investment / management of dealerships, franchisees, etc. that can be avoided, keeping the corporate structure lean and mean, which also contributes to price competitiveness vs. ICE engines.

3) You can completely control the buying experience, end to end, and you are the single point of contact for feedback from the customer. Things can be efficiently managed from a single website and associated call center.

4) As someone else has already mentioned, the relative simplicity of the Tesla powertrain will make it much more reliable than gasoline cars, so there will likely be less need for this overall. In addition, they won't have hit car sales volumes yet for these dealerships to be profitable, which is a problem in itself.

Re:What is the Tesla strategy?

[BasilBrush]

One of the big ingredients in Apple's turnaround was running their own stores, where they could display their products to their best advantage, control the message given to consumers, and give the best support in the business.

When they had been selling solely through general computer stores, the sales staff had no incentive to put Apple's products in their best light.

Let's keep big government out of business

[gurps_npc]

By making sure that small government totally blocks business!

That's how it's supposed to work, right?

state still dealing with Tesla

[fermion]

If I were a state I would remember that Tesla played one state against another until one desperate state gave them a reported $500 million dollars. If I were a resident of a state, I would ask why a profitable company wants to much more aggressive in emptying the public purse other companies.

I had some sympathy for Tesla and their fights with states even if I though that they should invest in states first to show some good will. Now they just seem like another evil company trying to make money by empty state coffers rather than making and selling a good product.

Re:state still dealing with Tesla

[grasshoppa]

So they *shouldn't* aggressively pursue profits?

Strange.

Re:state still dealing with Tesla

[oh_my_080980980]

Yo moron, read the article. Georgia auto dealers are preventing them from selling cars in Georgia.

Re:state still dealing with Tesla

[ksheff]

Tesla gets heaps of cash from selling zero emission credits to other auto manufacturers, so it isn't shy about getting "help" via governments to become profitable.

Re:state still dealing with Tesla

[mojo-raisin]

Uh yeah. Fermion is a pure anti Tesla, anti EV bigot. That's why he has been on my enemies list for a while. Is a great /. Feature that outs those in love with the status quo.

And how much of that stagnancy is because of....

[Anonymous Coward]

And how much of that stagnancy is because of a lack of options to choose from? I mean, really when you look at it there are VERY few models available as full EV - Tesla, and then a couple little entry levels that have been given EV versions... There's almost nothing available in between, and absolutely nothing in the small/mid SUV or mid-sized sedan or sport coupe markets to choose from.

Until there are more models to choose from that span all the market segments, there's always going to be a limited subset of buyers who will be willing to purchase these as their primary car...

Tesla is public company

[Anonymous Coward]

Tesla is public company with forward looking P/E ratio of 72. That is so high it boggles the mind. In order to keep the price from collapsing, like it should, they can either sell more cars (which they can't seem to do) or put up news stories like this for people who have no clue about investing, but have money to invest. Look at the comments above about how successful Tesla would be if they could sell cars in Georgia, like that one thing is preventing them from everything they want to do.

It appears to be a scam to make /. like people who won't buy the cars to at least buy some shares and hold off the collapse a bit longer.

Re:Tesla is public company

[Anonymous Coward]

I think you're just bitter. I bought 50 shares of Tesla last month at 259. I have no clue, but the $1000 is nice.

Comment from Tesla

[JamieKitson]

Tesla *has* publicly commented on how many vehicles it has sold in Georgia, it says that the 150 maximum is for a calendar year, while the 173 figure is for October to June and it hasn't hit the 150 mark for 2014.

http://www.autonews.com/articl...

Re:Comment from Tesla

[blivit42]

Autonews needs to work on their figure coloring skills. In a related article linked from the one previously mentioned, GA is colored medium orange, which indicates "Uncertain -- No formal legal or legislative challenges are known", when it should instead be colored light orange ("Legally allowed with restrictions on number of cars sold or number of stores"). From the article, it is clear that GA is legally allowed with restrictions on numbers of cars sold or number of stores, and there have clearly been formal legal or legislative challenges. Sad that they can't get their figures to match their own reporting....

an insight into the stagnation

[nimbius]

sterling allies of the separate but equal doctrine and creation science, Georgias firm stance against competition from Tesla shouldnt surprise anyone. Texas and Ohio do the same thing when it comes to selling cars in the interest of preserving a relic of a dying baby boomer era. We all know and love the car salesman for his even handed approach, calm demure, and truthful nature right?

another issue of stagnation is price. Outside of California and New York, electric cars largely dont have subsidies. this is partly due to the franchise racket, and partly because other states dont have stringent EPA mandates or emissions standards like california. Tesla is also, according to their website a 'premium' electric vehicle company. The average price for a Model S is around $90,000 US so among the worst wealth gap in history, the remenence of a major housing crisis, a looming student debt crisis, and rampant american unemployment its no wonder most people arent exactly leaping at the opportunity to saddle themselves with this. 90k is, or was, a decent chunk of a home for most people before the collapse.
target demographics are also not to be forgotten. Millenials like myself do not care for cars. give us light rail, busses, and trains but ultimately the thing that matters most to us is not that symbol by which our parents projected their status. cars are expensive to maintain and own for us because we earn less than our parents do and, once again, are commonly saddled with an enormous amount of student debt. make it as futuristic as you want, thats fine, but that centre console only does half the things our smartphones are capable of, and requires us to multitask and drive while using it.

Re:an insight into the stagnation

[jeff4747]

A far greater insight can be achieved by looking at the statistics they used to declare the sales "stagnant".

Electric car sales fell 0.1% as a proportion of total car sales....during an August with more car sales than have been seen in years.

In other words, they held about the same percentage of sales when total sales massively shot up, despite the very small number of models available. That ain't stagnant.

Re:an insight into the stagnation

[Anonymous Coward]

Millenials like myself do not care for cars.

Speak for yourself. I'd rather not wait 20 minutes in -20C all winter for groceries. Let alone the 5 hour trip to family home instead of 2.

Re:an insight into the stagnation

[Anonymous Coward]

The average price for a Model S is around $90,000 US so among the worst wealth gap in history, the remenence of a major housing crisis, a looming student debt crisis, and rampant american unemployment its no wonder most people arent exactly leaping at the opportunity to saddle themselves with this. 90k is, or was, a decent chunk of a home for most people before the collapse.

I wonder how people justify this kind of purchase even if they can afford it. My household could easily afford 90k, but there is no way that I would ever pay this much money for transportation, even if my net worth was an order of magnitude higher.

That being said, I'm glad that there are people who do think that this is worth it and enable Tesla to scale up production and hopefully reduce costs in the future, even if I don't understand their incentives.

Re:an insight into the stagnation

[Anonymous Coward]

Millenials like myself do not care for cars.

I'm a "millennial" and I like cars just fine.

give us light rail, busses, and trains

No, please. Don't. Not for local transportation, anyway. I'd rather not live in an urban hellhole. There isn't enough money in the world to entice me to live in NYC, much less other cities with "less to offer" (at least by New Yorkers' estimation). Trains are great as a replacement for intranational ("intra-", not "inter-") flights, and honestly, most shipping should be done by trains. But commuter trains are barely worth the trouble, and they tie up tracks that should be used for long-distance travel. Ones on dedicated tracks (like subways and above-ground light-rail systems) are OK, since they do reduce insane traffic in congested metropolitan hellholes.

but ultimately the thing that matters most to us is not that symbol by which our parents projected their status

Cars are not a status symbol any more than buses or trains are, so I'm not sure whether you're descended from insanely shallow parents or just stupid.

cars are expensive to maintain and own for us because we earn less than our parents do

No they're not, and no we don't. Shitty cars are expensive to maintain. If you buy a decent one, it won't be that expensive. Just be sure to count the cost. And I don't know about your specific circumstances, but I certainly do not make less money than my parents did at my age. I make well over twice as much, even after accounting for inflation and cost-of-living.

saddled with an enormous amount of student debt

Sounds like a personal problem. I left college with no debt because I recognized student debt for the trap it is and avoided colleges that I couldn't afford.

requires us to multitask and drive

"Requires" is probably not the word you're looking for. Either that, or you have self-control issues.

Don't extrapolate your circumstances to everyone else. They're your circumstances. You, not anybody else, owns them. And there's a big world outside of NYC (or whatever urban hellhole you call home). Your world-view seems to be limited by the echo chamber you have chosen to live in. If you like it, that's fine. But don't expect that to be typical of everyone.

Re:an insight into the stagnation

[0123456]

Millenials like myself do not care for cars.

Not much use for one when you live in your parents' basement because you can't afford a house, and commute across the road to flip coffee in Starbucks.

Re:an insight into the stagnation

[Locando]

That sounds like that's more about bad public trans, not the necessity of cars. Don't know where you are where it's -20C all winter, but it does drop that low in Chicago, and waiting 5 minutes for the L under heat lamps isn't particularly worse than any other means of getting around. Much better than having to scrape ice off your windshield if you ask me.

Plus, who takes the bus to get groceries? I don't know anyone who'd say that wouldn't suck. If you're going to live by choice without a car, you make sure you've got a grocery store within walking distance. Just common sense. The family home thing is trickier (I haven't been in that situation) but it doesn't take so much imagination to see how people in parts of the world with better trains might have a different opinion. A lot of us have to fly to visit family anyway.

Re:an insight into the stagnation

[Locando]

I don't know why you're calling big cities with lots of jobs and cultural opportunities "hellholes." You have the choice to live in the suburbs or a smaller city, and clearly that's the one that makes sense for you. But why do you tell one person how limited their worldview while yourself attacking people different from you?

Rather un-American, no?

[wyr_taliesin]

Surely only a bunch of liberal Commies would pass laws that ban citizens from selling legal things to each other? Shame on all those Commie legislators in Georgia!

NOT stagnant

[zwede]

Tesla had a 2 month backlog (time from order to delivery of a car) of 2 months early this year. In the spring it grew to 3 months. Early summer they upped production to address this, but backlog grew to 4 months. Tesla is building more cars than ever, yet the wait keeps increasing.

"Stagnant" my ass.

All this for a car that was introduced almost 2 years ago and has had virtually no updates during this time. Shows how far ahead of other manufacturers they were.

Re:NOT stagnant

[Anonymous Coward]

I know backlogs for AUDI that go back up to nine months. So you're relatively well off compared to us, other ones.

Re:NOT stagnant

[Anonymous Coward]

Tesla is not the entire EV market. Once you get past the Tesla circle jerk that goes on around here you'll see that Tesla really is a minor player in the overall market.

Electric car sales in the U.S. have been stagnant?

[Anonymous Coward]

Turn OFF air conditioning and instantly save up to double distance of in-car advertised electric-only range on any given battery charge. Tested in on VOLVO V60 Plug-In Hybrid.

No surprise

[Anonymous Coward]

Of course the laws appear to favor "the people". All laws are spun in that direction. What did you expect -- that the law would state it's purpose as "fleecing the majority for the benefit of the elite few"?

What about interstate commerce

[Anonymous Coward]

I would think it covers just this.

People won't buy what dealers won't stock.

[Anonymous Coward]

Other than the Tesla, only Nissan has a pure electric generally available on the market

That's not entirely true, currently available full EVs include the:

        Tesla Model S
        Mitsubishi i-MiEV
        Nissan Leaf
        BMW i3
        Ford Focus Electric
        Volkswagen e-Up!

That's not an exhaustive, but those are commonly available to buy today in the US.

The number of people willing to buy a car sight unseen is pretty low, so dealer unwillingness to stock the cars is a pretty effective lockout for most people.

After several months of trying, the only two of these that I was able to test-drive were the Leaf and the Tesla. The dealers in a 200 mile area around my home do not have electric cars in stock and will not order them just for a test-drive, even when you tell them you are definitely buying an electric car. The local Nissan dealer is selling a steady stream of Leafs, though, because he orders a new one for the lot every time he sells one (so he has three in stock at all times, with three different trim packs).

Unsurprisingly, I bought a 2014 Leaf. But when I put the 240VAC charging station in the garage I put in a Tesla outlet as well! If the prices keep dropping, I'll eventually need it...

PS: - If you buy a Leaf, be sure to buy the top charging option - I cannot stress this enough. Nissan Leaf charge times are completely impractical without the 6.6 KW on-board charger and a 240 VAC EVSE (a cheap, reliable EVSE will cost between $300 and $1200 depending on how strong your geek skillz are). Do not cheap out and buy the low end charging option, you will hate your car if you do.

Evolve or die.

[Mysticalfruit]

Telsa should be able to operate showrooms where it wants and their competitors will either improve their business practices or perish, period. Let the free market sort this out.

Whenever I see a dealership invoking some obscure franchise law, what I hear is: "We're a dinosaur that can't compete against Telsa."

Re:You forgot to add ...

[tomhath]

Nope, in 1999 both houses of the Georgia legislature and the governor's mansion were controlled by Democrats. You can look it up

In 1998, Barnes ran for governor again, this time defeating Secretary of State Lewis A. Massey to win the Democratic primary.[9] Running on the themes of education reform and health care reform,[5] he defeated Republican businessman Guy Millner in the general election with a victory of 53% to 44% to become the 80th Governor of Georgia.[2][10]

The Democrats retained control of both houses of the legislature[11] and retained all but two state level offices

Re:Electric car sales in the U.S. have been stagna

[NotDrWho]

In Georgia in the summer?? Yeah, have fun with that.

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