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Tesla Sues Michigan Over Sales Ban (usatoday.com)
An anonymous reader quotes a report from USA Today: Electric automaker Tesla Motors filed a lawsuit Thursday against Michigan state officials, escalating its multi-year battle to sell vehicles directly to consumers. Tesla's action comes less than a week after Michigan Secretary of State Ruth Johnson effectively rejected the automaker's application for dealership and service facilities by asking for proof that Tesla is a franchised dealer. Tesla, unlike other automakers, sells its cars directly to consumers through company-owned stores in other states. "Tesla Motors brings this lawsuit to vindicate its rights under the United States constitution to sell and service its critically-acclaimed, all-electric vehicles at Tesla owned facilities in the State of Michigan," the automaker said in its complaint in federal court. The California automaker named Johnson, Michigan Gov. Rick Snyder and Attorney General Bill Schuette as defendants. Tesla submitted an application for a dealership license in fall 2015 with a plan to open a retail gallery in Grand Rapids, Mich. In a Sept. 7 hearing, a panel of administrative law examiners heard arguments. Last Thursday, they rejected the license for Tesla. "The license was denied because state law explicitly requires a dealer to have a bona fide contract with an auto manufacturer to sell its vehicles," Johnson said in a statement. Tesla wants to sell its high-end battery-powered cars directly to consumers without a franchised dealer, much like Apple sells its products. The automaker's lawsuit asks a federal judge to declare that the state violated the due process and equal protection clauses of the Fourteenth Amendment and the constitution's commerce clause. Snyder signed a law in October, 2014, that prohibited Tesla from selling cars directly to consumers by requiring all automakers to sell through a network of franchised dealers.
Is good for Michigan!
I am cheering for Tesla to disrupt dealership system, as these dealerships are substantial and unnecessary added expense and hassle. They are there to sell you electronic rust modules and turbinator options that you don't want and rip you off on oil change "service" packages. Manufacturers should be able to sell directly to customers.
you don't think mfg'ers do that already? all it does it cut the middle man out... who also raise the price.
This law was inacted because Henry Ford was a 'douche' back in the day and they wanted to stop it from happening. BUT unlike then the industry has a lot more players all with competitive products. If a company wants to sell direct they should be allowed to. That is how it works with - for example - mattress.
But unlike epiPens, there are a plethora of vehicle options, and Tesla has minimal impact in the market compared to the major players.
So you have hypothetical abuse in an implausible scenario. Poor reasoning for this action.
The problem with Detroit is Googleism.
these old laws were in place for a reason... allows the manufacturer to set the price.
The old laws are from a different age. If any one manufacturer tries to do that now, global competition will be all too happy to undercut and capture their market share. If, for example, Ford and Chevy collude to jack up prices on pickup trucks, within production cycle you will have Toyota and Nissan capturing their market share.
That epipen company is a perfect example, because Tesla has a monopoly on cars?
these old laws were in place for a reason.
Old laws? Did you read the article or just skim the summary?
Snyder signed a law in October, 2014, that prohibited Tesla from selling cars directly to consumers by requiring all automakers to sell through a network of franchised dealers.
In terms of legislation, since when is 2014 considered "old"? They introduced this law right before Tesla planned to open an outlet and blocked them from competing with the local dealerships. That stinks
Tesla isn't suing over something that's been on the books for a long time, this was a law specifically enacted in the ye old days of 2014 to screw Tesla over.
Old Laws that never should of been laws.
Tesla could save money if they have an exceptionally expensive process to become a candidate for a franchise - but sell one dollar a year franchises to people they feel are "worthy" without training.
Law circumvented.
_ _ _ Go for the eyes Boo! GO FOR THE EYES!
these old laws were in place for a reason.
Yes and the trick is understanding those reasons. The incumbents use the law to protect their position, and the new guy uses tries to get new laws to protect theirs. Don't pretend that somehow existing laws are intrinsically better than new ones.
The manufacturer already set the price with invoice pricing and MSRP. Just 3 days ago, "GM sets Bolt electric car price at $37495". So... how does having dealerships help?
these old laws were in place for a reason.
Actually, they are in place for several reasons:
1. Greed
2. Cronyism
3. Corruption
skipping the dealer allows the manufacturer to set the price
Saturn used fixed prices, despite using dealerships, so this seems like a bogus argument. Dealerships are just another layer of inefficiency, adding delay and expense.
My state, California, allows direct sales by manufacturers. How do people in Michigan benefit by having fewer choices than I have?
You can buy a car direct. for example European Delivery.
What in the fucking world are you talking about? Car dealerships are middlemen that add little to no value and take a cut. They raise prices, not lower them. There is no credible evidence that they prevent monopolies or are even remotely protective against them.
Look up European Delivery. Oh, of course, only available for people who can afford it. So plebs loose out.
Dealerships are a tool to "Limit Competition" and options. Not something you should have in a free and open society... Its the same thing as having to have a million dollar badge on your taxi to drive a cab in NY... That kind of forced employment and entrepreneur limitations, basically forcibly binding those cab drivers to a corporate "Master", is NOT what America is all about. That kind of Market limiting should be made a felony crime. Its an Anti-Competitive practice, that includes a touch of malice towards we the people, with a dash of price gouging and fraud.... Aka, Crimes
It's funny, I clicked through thinking nobody could be stupid enough to defend the laws written by auto dealers to prop up auto dealers' businesses.
And then dknj showed up.
Do you have ESP?
Wait so the car manufacturer's can't increase the price that they charge their dealers? All Fords will always be sold at the same price point forever?
Ignorant geeks with at best 1-2 "econ" courses under their belt, combined with the common but still rabid libertarian rabble will deny the validity of your comments. However, imagined conspiracy and "upstart" philosophy doesn't change the reality of how things actually work. See here for information. The law is entirely designed to enforce standards. This lawsuit is just Musk pouting that his "upstart" position doesn't already work everywhere, and wanting to sell in MI subjects him to some regulations on the state of vehicles being sold.
People need to stop voting for asshats like the MI governor. They should be allowed to do business. The fossil fuel industry is intent on dragging us into the abyss and their minions need to be kicked to the curb.
Old Laws? Not quite 2 years old? "Snyder signed a law in October, 2014, that prohibited Tesla from selling cars directly to consumers by requiring all automakers to sell through a network of franchised dealers."
skipping the dealer allows the manufacturer to set the price. and they would never fix the price with a defacto monopoly, right?
Haha, what? You're whining about a manufacturer selling their product for whatever price they want to sell it at? Tesla "fixing the price" on their own products that they make and sell themselves, that's funny. How does a single company "fix" the price? They don't "fix" the price, they set the price, that's the price, anyone can buy it at that price. You might as well whine about McDonald's "fixing" the price on a Big Mac because they cost the same anywhere you buy them.
Tesla doesn't have a monopoly on electric cars, and they don't have a monopoly on cars. If they want to set the price of their cars at $100,000, fine, they won't get a ton of sales but if they make a profit then why do you care? If they want to compete with other car manufacturers then they can lower the price, or they can design another model which costs less to produce so that they can reach a bigger market and still make a profit. Guess what Tesla decided to do with the Model 3. Go ahead, guess.
Tesla doesn't have a monopoly on anything except Tesla cars, and you don't have some right to buy a Tesla car for $10k if they don't want to sell them for that much. Don't bitch and moan about old laws that were bought and paid for that shouldn't exist any more. The car market at this point is too big and has too many competitors for price fixing, because if that happens there is a major opportunity and incentive for one of those many competitors to undercut everyone else and make huge sales.
"Our two-party system is like a bowl of shit looking at itself in a mirror." - Lewis Black
That is not the history of the Laws. It codified the standard practices of cars at the dawn of the automotive age. car companies could not afford to spread out on there own. And remember there were dozens of car companies.
Dealer laws are made to protect dealers. They do not protect customers.
Dealer Competition? They add to the price the car company sets. Brand Competition is the control.
What's Musk scam? Model S is the best car I've ever owned. Going on two years now. What experience do you have with Tesla products?
You know, I see a bunch of rights in the constitution, a bunch of them getting shit on by the republicans, and a bunch by the democrats. However, nowhere in there do I see a right to sell anything to anybody. That 14th ammendment? Talks about people, not corporations. That commerce clause? Specifically talks about interstate commerce, not dealers inside a state. If it meant what Tesla claims it does, then the state wouldn't be able to regulate any sales at all, or, for that matter, tax them.
Adam Ruins Everything - The Real Reason Car Dealerships Are the Worst.
Summarising the vid: dealerships have pressured/lobbied Congress (in the US) to pass franchise laws. Which make it so you can only sell new cars if you're a car dealership. And there are dealership "territories" so it's illegal to open a new one in another dealership's territory. So car manufacturers in most (all?) states can't sell directly to customers.
(Though I'm not quite sure how Tesla has been able to sell cars directly to customers in states other than Michigan.)
They're really just repair shops who've applied with an auto manufacturer to become a local monopolist middle-man for a brand of automobiles and associated parts. They make the bulk of their money on repair work (in-warranty from the manufacturer and out-of-warranty on highly marked-up fees charged to consumers).
As far as I'm concerned, the sooner we move to a world where all cars can be purchased online direct, the better.
Confirming that dealers undercut the manufacturer price, selling cars at a loss to keep capitalism alive.
What, are you on fucking crack?
Seven puppies were harmed during the making of this post.
Musk is going to get wise, hire a fleet of limos and drive prospective customers out of state to pick up the cars they bought/put a downpayment for online. America isn't THAT big, and most people are never more than an hour or two from a state line unless they're in the middle of TX or something.
Seven puppies were harmed during the making of this post.
What kind of car does European Delivery make? Oh wait, according to the wikipedia page, "European Delivery" is a program(me?) where you go to the local US dealer and they sell you a car in Europe and give you plane tickets to fly over there and drive it around. I bet they still take a cut off the top.
I for one believe in the rights Tesla is fighting to uphold.
Gulf States Toyota put undercoat on all cars. And way overcharged for it. The dealers were not allowed to buy anywhere else, and Toyota was banned by law from interfering with the dealers. They got in their position of power due to the insane laws, and are now one of the forces against change.
Learn to love Alaska
I must say that my experience with Tesla is the polar opposite of my experience with a local dealership. In both cases I had to wait 6 months to get the car I wanted. With the dealership I ended up with my 3rd choice of color and they kept pushing me to take a white car either missing options I wanted or with extra options I did not want. When I picked up my car they tried to sell me a bunch of stuff I didn't want. After I got the car they would frequently try and push extra service the car didn't need or didn't bother trying to find a very common problem the car had. Then just after the 3-year 36K warranty the HID headlights started burning out, another well-known problem with the car I bought. Despite the fact that I had a 7 year, 100K warranty and that the headlight bulbs were well under the rated lifetime they wanted to charge me $200/bulb ($50 on Ebay) plus a ton of labor. I have since sold the car to my father and the center display touchscreen stopped working. The dealership wants $5K to replace it, much of that for labor. The touch screen costs a fraction of that and I found a youtube video where a woman shows how to replace it in around 20 minutes with simple hand tools.
With my Tesla I got exactly what I wanted. Up until they made my car I could pick and choose what options I wanted through the web site with it immediately updating the price. This is unlike a dealership where I'd have to wait until they got something in inventory or found a car elsewhere with my requirements. With Tesla, most cars are made to order so there's no inventory sitting on dealer's lots other than test drive vehicles and loaner cars. The people running the showrooms do not earn commissions and there were no high-pressure sales tactics. They were there to show the car. I would say most people there were simply looking and probably not going to buy one but they treated everyone I saw there with the same respect they did me.
For loaner cars, which are always fairly new and usually with many bells and whistles there's always the option of trading in your car for the loaner car.
Tesla has always treated me well when it comes to service. My car had a number of issues, mostly rattles and other noises since my car was one of their early cars. They learned a lot and made a lot of improvements since I got mine.
Last spring I got a hole in the sidewall of my tire out in the middle of nowhere and the closest tire center was 62 miles away. I called Tesla which has free towing for up to 50 miles. They sent out a tow truck and put it on a flatbed to the tire center I selected after calling around between Tirerack and the tire centers and asked the tow truck driver how much I had to pay to make up the difference. He said Tesla covered it even though it was over their limit. Tesla also called me back to make sure everything was OK. The biggest hassle was the fact that I have low profile performance tires that aren't commonly stocked.
They have always gone above and beyond with service and when I have had to pay for it like when I broke a clip on my car they did not gouge me parts or for fixing it unlike the Toyota dealership.
Another time I had a blow-out and bent rim due to San Jose's poor excuse for a road at 3am. I called them up and they sent out a tow truck with a replacement wheel and tire until I could come back at my convenience and have them replace it (I bought tire and rim insurance through Tesla).
The last time I had service done on my car they dropped my car off where I work and picked up the loaner.
Elon has stated on numerous occasions that they do not want to make a profit off of service. This is the exact opposite of how dealerships work. Most dealerships don't make much money selling cars. They make their money through financing and service. If there's any complaint I have about service it's that if it isn't something that needs to be taken care of immediately that there's often a wait since they seem to have problems keeping up with demand. Since I also use the service center at the factory, it is also busy helping prep new cars so certain times are particularly bad like the end of the quarter.
This post is encrypted twice with ROT-13. Documenting or attempting to crack this encryption is illegal.
Infer whatever motives you like. I don't like the reality this law creates and want it gone.
This is a YouTube video from Adam Ruins Everything on "The Real Reason Car Dealerships Are the Worst", starting at 0:50 (https://youtu.be/uMWmYJOa-BM?t=50s) telling why you can't just go into a store and buy a variety of cars or order them online on Amazon, for example, then (and this is the point) at 1:18 (https://youtu.be/uMWmYJOa-BM?t=1m18s) goes into the FRANCHISE LAWS the car dealerships got passed. If I can't post with these links, you can look up the same video on YouTube easily with "adam ruins car dealerships". Hopefully, this sheds some light on the subject :-)
There is no "right" to sell anything in any given state in the US. The oft cited constitution only mentions interstate commerce restriction as another post mentions. There are no court rulings establishing duty to provide a marketplace to a private company. And the dealership laws are about regulating the dealerships themselves. It is all record keeping for safety, and ensuring legal title for sales meaning that the car wasn't stolen, etc. Slashdot is really going downhill with clickbait.
Tesla should make a bona-fide contract WITH ITSELF :)
Wait, Trump makes electric cars?
"Nine times out of ten, starting a fire is not the best way to solve the problem." - my wife
Obviously. Tesla is the only manufacturer of cars and holds the patent for them.
I don't like your comment so I am making a comment on the off chance that I get in a comment war which is fun and I believe I have a history of winning. So if a comment war is not fun for you, I suggest you refrain from making any further comments like om yours in the future. Because whether or not a scam is part of Musk's game, being in control definitely is and that is something I can get behind with Musk, Trump, and that kid from "The Maze Runner" and Ender from "Ender's Game" because that fits the pattern too. And if you don't know what happened to people who opposed Ender, I suggest you read the book, because I have not seen the movie yet and I don't know how well it spells things out. Clinton appears to be out of control, so forget her. Obama did do the right thing in standing up to the defunding of government bit, though. I recognize strength and opportunity.
Until the voters decide otherwise, this is still a capitalist economy. A company should not have to ask permission to offer a legal product for sale.
Manufacturer price isn't cost by a long shot - it is LAC (including average overhead) for the expected lifetime of the product plus a significant bonus for them. Musk's company is sticking it to customers with monopoly distribution and playing the "it's research when we say it is, but also your liability as soon as you complain" angle.
Car dealerships will lose in Federal court because it's harder to bribe the Feds.
Car dealerships are generally the most consistent donors to local politicians, and thus are pretty much insulated from adverse laws at the local and state level. They haven't been as active at the Federal level, but if Tesla wins expect that to change...a lot.
Dealers are slow to pick up on the negative effects of self-driving cars, but once they do they'll also start their Federal lobbying campaign.
And when I heard "European delivery" I thought of this: http://www.investopedia.com/te...
You don't understand what business in society means, it isn't an academic exercise where you can wank off to Ayn Rand. Business routinely involves every single character fault in every actor, conflicting interests where those with most effective advertising "win", etc. and regulation is the only tool to combat it for the public.
Musk can open a Deleware based company, when can then buy franchises from Tesla, and as well as opening other companies inside of Michigan.
Musk & Tesla of course don't have to directly own any of the Franchises, his holding company can own them instead.
Look up European Delivery. Oh, of course, only available for people who can afford it. So plebs loose out.
God damn dude, it is lose! Stupid fuck.
Tesla only sells white cars, not black cars. That is blatantly racist. #BlackCarsMatter!!! ;-)
Tesla is entitled to Equal protection under the law.
A person has whatevr rights he can take and this is a rigt I really want taken. You don't understand how rights work.
So not a sign of corruption and regulatory capture at all then?
this, among many other reasons (hello cablecos/phonecos), is why states should not be permitted to govern themselves, and why you people cant have nice things anymore. dont you 'murkins have 'restraint of trade' to sue with?
you really think that tesla's prices represent only a typical manufacturer's profit margin? and not enough to cover a dealer's markup.. and then some? bull fucking shit. there's a full markup, and then some, and then even more.. and then to top it off, the whole thing is obfuscated because they promote the living shit out of tax credits you get when you buy one and blend that right into the quotes.
tesla could easily get a nationwide dealer to operate their 'stores' if they wanted to, and without the retail price going up..... IF they wanted to, but musk would rather sue instead.
Come back to us with that argument when Telsa starts making a profit.
You could have stopped with, "you don't understand what society means". Look around you; less and less people do.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Being allowed to sell something isn't a right, it's a privilege. One that Tesla doesn't have.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
While I agree with much of your sentiments, you don't seem to realize how rights work either, (There was a person in another thread that took quite a different position that didn't understand how rights work) If he can find a way to take the right to buy a Tesla car at 10k he has that right. I don't find that likely, so I agree with you that he doesn't have that right, but that doesn't appear to be what you wanted to convey.
So why isn't Tesla simply trying to change the law?
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
They tried. They failed.
The difference here is that Tesla is not the only company making cars (or even the only car making battery electric cars). If Tesla increases their prices too much, people will just buy from any of the many other manufacturers that exist.
At one time I would have been against this law. I saw too many middlemen and I hated middlemen because they made things more expensive. But then I saw a lot of companies arrive that were very successful at eliminating middlemen, but their products didn't get cheaper they just kept more of the profit. Not only that but they treat their 'workers' even worse then the middlemen did. So now I agree with any kind of law that protects the distribution of wealth to as many people as possible.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Actually, the US is more socialist than capitalist. The US tax payer covers cost of living for employees of the largest companies like Walmart and McDonalds. The government creates jobs under the guise of protecting the nation and employs directly or indirectly (by my highly suspicious estimates) 20-25% of the working population (DoD, DoE, CIA, FBI, DHS, TSA, NASA, etc... Lockheed, Boeing mostly, etc... plus the infrastructure to support them). When a person needs a job, the government makes one for them.
The voters decide otherwise every single day. They vote all the time for what they believe will serve their own interests. What's worse is they have no idea what their own interests are. We make most of out decisions without any real information or education.
Suppose that this forum represents a class of voters. We read a headline posted by someone with an obvious bias. The people reading this site tend to take one of two positions "I love Tesla" or "I hate Tesla". They voice their opinions like "I for one believe in the rights Tesla is fighting to uphold." and someone responds about how they don't understand what they're actually saying. Of course, the response will make no impact and the Tesla lover will still love and vote "Tesla is good, I support people who support Tesla". He has no real idea why Tesla is good... all he knows is that they make "clean" electric cars. He overlooks that Elon Musk and Tesla have set some extremely dangerous precedents in the name of doing good things. We justify it by saying too good outweighs the bad, and while Musk is probably a really great guy, and while we really want him to do the things he's doing, he's basically leaving a wake behind him of sheer disaster and destruction which will be colonized by the bottom feeders under the pretense of "You told Elon Musk it was ok... it must be ok for us too!!!".
I love the idea of Elon Musk, he's a dreamer and when I pick up the newspaper each day, I look forward to the stories about him as much as I looked forward to the comics as a child. The newspaper is full of just utter shit. "This politician is a dick, that one is a dick. The world is coming to and end. 14 pages of articles about last night's killings and battlefield crap."... then there's an article about a guy who seems to be building the world of the Jetson's. He'll make us zoom around in tubes as the speed of "Holy shit my face is peeling off" and fly us to the stars. He'll build our houses out of batteries and my grandchildren will glow because of him. His popularity and the way the press treats him makes me feel like there's still room for good news and hope for the human race. He's a real life Tony Stark and I can't get enough of him.
He'll poison us with massive quantities of lithium. He'll build cars with limited life spans and no real plan for how to recycle them. He'll move from metals to plastics, polymers, etc... which have no future but land fill. He'll do lots of awesome things that will simply shit all over the planet. He'll make the environmental disaster left behind by the big three in Michigan look like child's play. Everything the guy touches is basically toxic by the time he walks past it. But holy shit, I hope he doesn't stop! I LOVE HIS STUFF!
I just bought a BMW i3... I really wanted a Tesla, but the car is too f-ing big and frankly, Tesla drivers are generally dicks and I don't want to become one. I actually drive in the normal traffic instead of the taxi/carpool lanes because I don't want to negatively impact the other drivers. Electric cars don't need those "perks" anymore since they were there for the crappy pre-Tesla cars which couldn't get to and from work on a charge in stop and go.
these old laws were in place for a reason. having a new hip company come back at the expense of old slow legislation doesn't fix the problem that skipping the dealer allows the manufacturer to set the price. and they would never fix the price with a defacto monopoly, right? that epipen company is a perfect example of raising prices for reasons of costs. i'm sure tesla would never do such a thing.
-dk
I don't see how having a franchised dealer network changes the situation at all? If GM wants the Chevette to cost $50K, then that's the price they can sell it to the dealer (taking into account all of the dealer incentives), no dealer can sell cars below their cost (for long).
Ignorant geeks with at best 1-2 "econ" courses under their belt, combined with the common but still rabid libertarian rabble will deny the validity of your comments. However, imagined conspiracy and "upstart" philosophy doesn't change the reality of how things actually work. See here for information. The law is entirely designed to enforce standards. This lawsuit is just Musk pouting that his "upstart" position doesn't already work everywhere, and wanting to sell in MI subjects him to some regulations on the state of vehicles being sold.
The law can set standards for performance without dictating the business model used to meet those standards.
Just what do you think a right is?
Business routinely involves every single character fault in every actor, conflicting interests where those with most effective advertising "win", etc. and regulation is the only tool to combat it for the public.
So why are you wanking off to Karl Marx and standing up for car dealers?
It's funny, I clicked through thinking nobody could be stupid enough to defend the laws written by auto dealers to prop up auto dealers' businesses.
It's clear GP doesn't know the real history behind auto dealers and franchise laws. In case others don't -- car dealers came into existence a LONG time ago (early 1900s), back when a number of factors existed that no longer apply now. There were no highways back then; manufacturers needed somebody local to coordinate distribution. Communication was more difficult in case there would be problems with a direct sale. And there were only a few major auto manufacturers, so there was concern about monopolistic behavior (whereas individual dealerships could both inform manufacturers of local market costs and potentially compete with each other to ensure low prices). Today, distribution and communication are easy, there are quite a few domestic and foreign manufacturers competing, and one can see list prices for cars on the internet instantly from across the country, so the value of local competition is greatly diminished.
But perhaps the greatest reason for dealerships back in the early days was maintenance. Cars were relatively new machines and needed very frequent maintenance compared to today. Few independent mechanics had the expertise in the early days, so manufacturers needed people throughout their sales area to provide service. Nowadays, many cars can run for years only needing a periodic oil change, and dealer shops are largely known for being overpriced (often many times the cost independent shops) and often no more competent than the average independent shop.
This explains why dealerships existed. Why they were granted special legal status often had to do with wars with manufacturers, e.g., during the Great Depression when manufacturers continued churning out cars and effectively forced dealers to take inventory they didn't want.... basically under threat that the manufacturer could "cut them out" if they really wanted to sell cars more directly. So dealers banded together and got laws passed to protect themselves from abuses by manufacturers.
That's really why we have a lot of these laws -- they weren't meant to protect consumers. They were dealerships trying to protect themselves against manufacturers back in the day. Nowadays, there's little justification for dealers anymore, so they're just trying to protect their own businesses from going extinct.
Oh, and GP's worried about price-fixing from manufacturers? Seriously? In a day when you can instantly see the price of a car anywhere in the country? If you allowed the possibility of direct sales, most manufacturers probably wouldn't want to destroy their dealer network, since there are all sorts of kickback schemes going on there, the value of maintenance contracts, etc., plus local presence creates more publicity.
Anyhow, the thing is -- monopolistic concerns mostly become an issue if there are few choices. There are lots of car manufacturers, lots of models, and even lots of used cars. Consumers have a LOT of choices. If manufacturers suddenly start jacking up prices, fewer consumers will buy. Maybe they'll switch models or even brands entirely. That's how the market works. I can't possibly see how propping up the car dealership franchises will lead to lower retail prices these days. They were a necessary part of distribution back in the day, but nowadays they're just a middleman who adds a LOT of overhead to the whole transaction and tries to sell you service you don't want (since that's where they can actually make more money).
If they cant get the laws in places like Michigan overturned via the courts or lobbying, set up independent dealers in those states.
Put out an offer and say "if you are willing to follow all our rules, we will give you an exclusive license to sell Tesla cars in Michigan". Set the rules in a way that they comply with Michigan laws but dont hurt Tesla.
Insist that the entity that is given the license is not allowed to have any connections to any other car company or dealership and must only operate and sell Tesla vehicles. (this would then take away any possibility that the dealer entity and Tesla dont have the same ultimate aims).
Insist that sales and service staff at the dealership must undergo mandatory training from Tesla corporate (same training as staff at Tesla owned stores undergo) so they know how to properly sell the virtues of electric cars.
Do what Apple does with 3rd parties that sell iPhones and things and insist product be sold at a fixed price with no haggling.
If the franchise agreement is drawn up properly it should be possible to have dealerships in Michigan that meet the requirements of Michigan dealership laws AND keep all the things that make Tesla different from other car companies in place. (note that I haven't read the laws that apply to car dealers in Michigan so I dont know if there are things that would prevent Tesla from making such an agreement)
If by "compelling reasons" you mean a strongly entrenched and well funded lobby of dealers who already own the politicians then yes, there are indeed compelling reasons. Did you ever wonder why dealerships are so often inherited? The story of how dealerships got their near monopoly status enforced by law is quite interesting.
I'm always interested in stories like that. Please provide links or keywords I could google.
USE HOT GRITS WITH STATUE OF NATALIE PORTMAN (NAKED AND PETRIFIED)
1. Make product 2. Sell product 3. PROFIT! Whoops! What was I thinking? I forgot ...
2.1. Spend the people's tax money to make and enforce a shit-pile of legislation designed to protect the entrenched interests of antiquated business models. Now hire an army of lawyers to defend your right to execute step 2.
Pfft... silly libertarians! Thinking they can just sell a product to people who to buy it and get away with it.
Might makes right irrelevant.
Whoops! What was I thinking? I forgot ...
Pfft... silly libertarians! Thinking they can just sell a product to people who want to buy it and get away with it.
Might makes right irrelevant.
should form a small LLC to act as a "dealership" - have it get dealership licenses in as many jurisdictions/states as it can, and then simply buy them or merge with them.
"have a relationship with a car manufacturer" is a bullshit requirement if "BEING a car manufacturer" doesn't fulfill it.
Haha, what? You're whining about a manufacturer selling their product for whatever price they want to sell it at? Tesla "fixing the price" on their own products that they make and sell themselves, that's funny. How does a single company "fix" the price? They don't "fix" the price, they set the price, that's the price, anyone can buy it at that price. You might as well whine about McDonald's "fixing" the price on a Big Mac because they cost the same anywhere you buy them.
A good example, 80% are franchises and 20% centrally owned but you'd never know the difference. The franchising agreement controls pretty much everything, so would a dealership contract. Some people still hasn't figured out what car dealerships was all about. In the before time, before the Internet and all that the car manufacturer would need a retail store, effectively a dealership since nobody would order a car by mail order or over the phone. But instead of that belonging to a big car company that took all the profits back to their corporate HQ, laws were passed to make that a local business that would keep it part of the local economy. It's a bit of a protectionist racket, but the local customers may have wanted it. Today though you don't need a retail store, because you can do it online. The car manufacturers want to cut out the middle man, the middle men want to stay. It's become a protection racket for e-tail vs retail instead of local vs big business.
Live today, because you never know what tomorrow brings
I'm not even American and I know this monstrosity of a law that classified companies as "people" is a fairly new invention by judges. This is exactly why these trade deals need to fail - Stupid can stay in America.
California bans all imports from Michigan.
Have you seen the cost of Tesla services? Considering there is so little to maintain on an EV, they are a massive rip-off. They don't even need to do many checks because it's all monitored in real time remotely.
To be fair Nissan charge silly money for Leaf servicing as well.
const int one = 65536; (Silvermoon, Texture.cs)
SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
A typical case where "Follow the money" is needed. What were the incentives to pass this legislation and where did they come from? It is hard to see that this 2014 legislation came from concern over the public good.
Being allowed to sell something isn't a right, it's a privilege. One that Tesla doesn't have.
Why doesn't tesla have the right yet McDonalds, Apple, Slazenger and a jillion other companies do? Oh yes, because dealers lobbied enough to get it enshrined into law that no one else is allowed to sell cars, especially not the people who make them. You HAVE to use the middleman who does nothing but make your product more expensive and they have no incentive to make a better service or compete on price because legally they have no competition. Just imagine you could buy a car at walmart or on amazon or from anyone who decides to open a car shop. How would that be bad for anyone except the entrenched car dealerships? Americans claim to be all about the free market but they stifle it at every opportunity.
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So in other words, there were compelling reasons to keep the law.
By compelling do you mean tesla didn't give them enough bribe money, sorry, lobby hard enough?
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Here's a starting place.
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Seems to me Tesla needs to sell more cars to survive. But it can't in Michigan because it refuses to follow the dealership rules. If I was a business owner would I focus on changing the rules or try and follow them and sell cars? In the end if Tesla ramps up sales it's going to need more places to fix them and service them anyway. What Tesla really doesn't want to deal with, is the consumer side of automobiles. The trade in's, the complaints, the dealership perks. But for many people that's what they are used to.
if you want proof as the the US economy is stagnant and managed by corrupt corporate political elite sell outs then just watch how an innovate US based company like Telsa is blocked at every turn by political BS.
The car pool lanes are there to reduce traffic and/or pollution. EVs are allowed to use them to encourage people to buy EVs and to reduce (at least local) pollution.
How does using then negatively impact other drivers? Not using then just increases traffic in the normal lanes, for no gain by anyone.
It seems that the freedoms that America once enjoyed are being increasingly eroded by lobbyists. I genuinely found the idea that you can't just sell what you want where you want hard to believe. Of course there must be regulation of things like drugs, making sure that they are only dispensed by qualified practitioners etc. But a car, I mean a frikin' car!
Tesla is the automotive equivalent of Apple. Cheaper alternatives will come along (such as the Chevy Bolt).
Eat the rich.
They are.
That's why they're suing. To get the law to change, by being declared unconstitutional.
And the reality is that it probably is. How is it equal protection for a law to say that one company can sell you a car and another can't? But that's exactly what dealership laws do, they only allow some companies to sell cars.
I'd like to open a dealership and sell Tesla cars....oops, Tesla refuses to let others sell their cars. Michigan is basically telling Tesla to go f-off, just as Tesla is telling dealerships to f-off.
I thought it was the agency that supplied Trump with wives.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
The manufacturer still sets the price, just dealers get to add more on top.
The dealer doesn't go to Ford and say we'll be selling for $10 today, so suck it up.
Not sure what you're referring to, but with European delivery you still need to pick and utilize a dealership to facilitate the transaction, even if you place the order online on your own.
Won't someone please think of the middlemen~
The real motive is protecting the car dealerships from competition and protecting their legacy business model.
Also, protection of Sales Tax revenues, which are huge..... Car sales are one of the largest sources of Sales Tax.
If prices go down, then that means lower tax revenue for legislators to fund their programs.
No it's not.... being able to dispose of your property is a right.
The states are allowed to regulate the manner in which you may do this, and what the quality of your goods presented for sale must be.
HOWEVER, the regulation of Interstate commerce is reserved for the Federal Government only;
the states do not have a legal right to prevent you from exercising the "privilege" to sell something across state lines.
allows the manufacturer to set the price.
Not only that Manufacturers DO set the price Minimum, AND dealers charge a mark-up.
You will not find dealers selling cars for less than the manufacturer price (After "incentives"), that's for sure,
the dealer would go bankrupt.
All the laws do is prevent manufacturers from setting a Price Maximum.
Prohibiting a price maximum does not protect consumers ---- it protects the salesman leeches who sit between the manufacturer and the end user who take their 20% to 40% cut of the sales price, as extra $$$ you pay, which you would not have to pay if you could purchase direct.
It prevents the manufacturers from setting a Price Maximum and putting all those bad salespeople out of a job.
And then dknj showed up.
You know.... some commentators could potentially be car salespeople or close relative/friend of a car salesman or other stakeholder at one of those dealerships.
Slashdot has many users. Wait around enough, and you're bound to find somebody commenting in support of less-popular positions. :)
You must be stupid if you can't find them, or you're a liar who hasn't even tried...
taking into account all of the dealer incentives
The dealer "incentives" or "bonuses" are a result of dealers negotiating a lower price with the manufacturers.
The manufacturer can refuse to negotiate, and then the dealer can refuse to sell their product, and thus lock out their access to those customers.
So the existence of dealers does affect the price of the product; HOWEVER, in the real world, all the incentives are just more profit for the middleman.
The dealers aren't negotiating with the manufacturers for end customers' benefit.
By prohibiting direct sales, not only do the states protect the dealers' business, they give them a very powerful negotiating tool against manufacturers to increase their own profits even more.
I'd like to open a dealership and sell brand new houses, but builders refuse to let others sell their products.
Having a company refuse to sell their products to dealers isn't unheard of if you look at other industries.
Personally, I'd like the Apple system. You can buy direct from Tesla OR from a dealer, just like how you can buy Apple products directly from Apple or from a "dealer" (ex. Best Buy). But thanks to the current laws, if Tesla started letting dealers sell their cars, then they'd never be allowed to sell directly to customers in certain states. The whole reason that they are allowed to is because they currently don't have any dealers there selling Teslas.
These laws are silly. Just like how it would be silly to make laws to stop Apple from selling products directly to customers and only go through stores like Best Buy.
"Hello Mr Jones, I see you are interested in a Model S P90D in red with XXX options. Just so happens our rental facility next door we have one for a 1-hour rental with the 1st hour free. It also happens that we just got in this rental and you will be the first one driving it! Once you get back from your rental you can buy this car through our Used Rentals Program, just like Hertz, Budget, etc, for $1 under new MSRP!"
...blocked them from competing with the local dealerships. That stinks
And what really stinks is that because the local dealerships don't sell Teslas, the competition they are blocking is really brand vs. brand, not manufacturer vs. dealer.
Certainly something that there isn't a law against! Why would you think that anyone should be able to sell anything they want any way they want when there are so many regulations for other types of companies?
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
If a law is silly and can be demonstrated as such then there is good news! Laws can be changed.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
My God, then drug companies should have a person on every street corner selling all their products regardless of whether they are proven safe or not!
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Snyder then uses another million dollars of state funding to pay for legal defense...
patent for "electric cars"??? What are you on? https://www.tesla.com/blog/all...
skipping the dealer allows the manufacturer to set the price. and they would never fix the price with a defacto monopoly, right?
Stop using words you don't understand.
Allowing an auto manufacturer to sell directly to customers and set prices without a middleman adding to the cost does not create a de facto monopoly. Allowing all of them to sell directly to customers and set prices would not create a de facto monopoly. That phrase means something completely different than what you seem to think it means.
Besides... Tesla already sells vehicles directly to consumers in many markets and sets the prices. Guess what? They don't have a de facto monopoly in those markets. They also haven't colluded with the several dozen other manufacturers who sell cars in the USA to fix prices.
There issomething flat-out wrong with tech CEOs at this point. It goes beyond ego or sociopothy - this is full blown delusion and megolomania. We can't continue to create a system where laws don't apply to them. I hope the judge laughs in Musk's face, and I hope they whack him on the butt on his way out. Pathetic.
They don't benefit. This law doesn't exist for the benefit of the consumer. It benefits the dealers who contribute to state lawmakers campaigns.
Ender from "Ender's Game" because that fits the pattern too. And if you don't know what happened to people who opposed Ender, I suggest you read the book, because I have not seen the movie yet and I don't know how well it spells things out.
I've not read the book but the film is shit and ends on massive let down. The kid in it though didn't seem particularly like a don't cross me type.
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You do know that dealers don't make money on new car sales, right? They make it on used car sales and service. Ever price out basic maintenance at a dealer? Or major maintenance?
Fact of the matter is, Tesla could have chosen to go through dealers, and they didn't - I wouldn't say this was wholly altruistic, either. In some ways direct sales are good, in others they aren't.
"There are a dozen opinions on a matter until you know the truth. Then there is only one." - CS Lewis (paraprhase)
You know, I was okay when the dealer told me my muffler bearings needed replaced. When they mentioned something about blinker fluid, I started to question them a bit...
Wait you didn't rtfa they have the right to sell just not to the consumer, only to a third party who will then mark up and resell it to the consumer. They do this under some misguided notion that this extra cost of a middle man somehow protects the consumer and local economy.
Tesla is the automotive equivalent of Apple. Cheaper alternatives will come along (such as the Chevy Bolt).
Except Tesla probably have a significantly higher BOM than most car makers, due to low volume and new tech. Apple have no such excuse, using no more advanced tech than anyone else, and having massive volume to boot, yet still charging a massive premium.
A better analogy would be Ford charging Tesla prices for their everyday cars, and people still buying them.
The state of Michigan is denying their residents rights to buy products they choose.
Once in a while, someone comes along ...and shows us how it's done. ...and drives the used car salesman to extinction. Good riddance!
WARNING: Smartphones have side effects--most of them undocumented.
What about my right as a consumer to not have to go to a monopolistic dealer who adds no benefit but increases the price substantially?
Wait, I'm confused--which anti-Musk narrative am I supposed to believe today? "Tesla only survives because of government subsidies," or "Tesla is raping its customers for buttloads of cash and making tons of moolah"?
Actually, the US is more socialist than capitalist.
Actually, it is neither. US is corporatist in the present day. Corporations write the laws, and give the baksheesh to the politicians that rubber stamp them.
The shepherds did so well protecting the flock that the sheep no longer believed that wolves existed.
Tesla sells through its web site. It can sell to Michigan customers without having to set foot in that state*. Or pay taxes there either.
*Run the in-state Tesla maintenance shops as subsidiaries, so the manufacturer has no physical presence there.
Have gnu, will travel.
Your silicon valley tech mentality holds no sway with the entrenched monopoly the unions have set up for its members over the decades. You'll be union busting before you break into some markets without following their existing laws.
That a way Snyder!
I just bought a BMW...Tesla drivers are generally dicks...
Ha, ha ha, ha, ha... the irony is rich...
Peter predicted that you would "deliberately forget" creation 2000 years ago...
Or a lazy person who hasn't read the article. Yes, I hear we do get those.
They are... What do you think lawsuits like this are for?
Peter predicted that you would "deliberately forget" creation 2000 years ago...
If you create more work with no actual increase in production, you are actually removing wealth from the system, not distributing it better/fairer.
In other industries there are types of middlemen that actually add value by performing useful service. In the car industry the dealerships are parasitic.
But, as always, such anti-capitalist laws pass easily partly because of the ignorance of people like you.
that's the only thing memorable in that entire rant.
Suing someone isn't part of the process to change legislation.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
These laws are silly. Just like how it would be silly to make laws to stop Apple from selling products directly to customers and only go through stores like Best Buy.
Most likely it depends on how you define Apple, My suspicion is the store are a wholly owned subsidiary corporation, and manufacturing is a owned subsidiary corporation as well, so legally they are two separate entities, what would stop Apple Stores, would stop Best Buy as well. It would be like telling Ford they can't sell cars in Michigan because I own stock in both Ford and GM!
Additionally it would be stupid for Tesla not to incorporate any stores in the states they are in because foreign corporations are at an disadvantage legally, it would be trivial for Tesla to draw up the legal agreements Michigan requires for franchised dealer, but Tesla doesn't want to be a franchised dealer, they only want to sell cars and the two aren't the same thing.
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Tesla isn't being stopped from interstate commerce, they, a foreign corporation, are being stopped from engaging in commerce in the state of Michigan.
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If Ford can do that, so much the better.
This is like Ford charging extra not for cachet but because they used the power of government to keep competition low.
Dealers in Michigan didn't want anyone opening on Saturdays, not because they valued their time off, but because forcing most to take a day off work to look at cars worked in their favor to rush people to buy.
(-1: Post disagrees with my already-settled worldview) is not a valid mod option.
taking into account all of the dealer incentives
The dealer "incentives" or "bonuses" are a result of dealers negotiating a lower price with the manufacturers.
The manufacturer can refuse to negotiate, and then the dealer can refuse to sell their product, and thus lock out their access to those customers.
So the existence of dealers does affect the price of the product; HOWEVER, in the real world, all the incentives are just more profit for the middleman.
The dealers aren't negotiating with the manufacturers for end customers' benefit.
By prohibiting direct sales, not only do the states protect the dealers' business, they give them a very powerful negotiating tool against manufacturers to increase their own profits even more.
Don't the customers have that same power? If they don't think the Chevette is worth $50K, then they won't buy it. Ford's highest margin vehicle is the F-150, yet that's sold through a dealer network, why haven't the dealers clawed back that high margin? Because they can't - Ford wants the money and consumers are willing to pay.
Similarly, I might want a Mercedes, but it's not worth the price premium to me (even though it's sold through a dealer network). For that matter, the Tesla isn't worth the price to me either. I'll probably go with a Toyota or Honda, though am also considering Hyundai.
It's not a dealer network that keeps manufacturers from making unending price increases, it's competition. If GM raises the price of a car beyond what consumers are willing to pay, then there are a half dozen other manufacturers that will be happy to take those customers.
Just because they don't vote the way you like doesn't mean this isn't a democracy.
I don't think you understand what he is saying.
(-1: Post disagrees with my already-settled worldview) is not a valid mod option.
Yes, but did they change the air in your tires? Air wears out, don't you know?
The real "Libtards" are the Libertarians!
Not to mention banks making buttloads of money financing floor-plans and parts inventories; not as much today as in the past with manufacturer's having financial divisions making more money than the manufacturing does.
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epipen is only a monopoly because of Government regulations and requirements.
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No they just call it "Doc Fees" and "Dealer Prep" instead of maximum; and don't forget all of those options you didn't want but paid for anyway so you didn't have to wait 2 months for your order, and the option packages where you pay for 3 things you don't want to get the one you do.
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More like ford and mercury
The law that Snyder signed in 2014, Public Act 345 of 2014, codified as section 445.1574 Prohibited conduct by manufacturer, has a lot of detailed regulations about how manufacturers may treat dealers. The requirement that manufacturers only sell through dealers is terse, and buried in the middle of it:
(There are several exceptions, some are grandfather clauses for pre-2000 manufacturer-owned dealers, the others don't appear to apply to Tesla.) Subsections (h) and (i) were present in the prior version of the law, so I'm not sure how old some form of that requirement is. The bill changed the tail end of subsection (i) from a reference to "the manufacturer's" dealers to "franchised" dealers, but the substantiative changes to the law were a new subsection (y) "Prevent, attempt to prevent, prohibit, coerce, or attempt to coerce a new motor vehicle dealer from charging a consumer any documentary preparation fee allowed to be charged by the dealer under the laws of this state" and a new section (3) "This section applies to a manufacturer that sells, services, displays, or advertises its new motor vehicles in this state".
Quiet human, this is a dispute between corporations and has nothing to do with you.
Which is more $ - court battles over a manufacturer/dealer relationship, or just starting up a freaking new company called "Tesla Dealership of Michigan" that buys products to sell from Tesla Motors and meeting the law's requirements?
Is a "store" somehow cheaper than a dealership/manufacturer relationship for tax/other reasons or what?
skipping the dealer allows the manufacturer to set the price. and they would never fix the price with a defacto monopoly, right?
You might as well whine about McDonald's "fixing" the price on a Big Mac because they cost the same anywhere you buy them.
Yeah! Except they aren't the same price everywhere. Even the TV ads says something like "Prices higher in AK, HI, and Times Square NY". And some franchisees "are not participating in the currently advertised offer." So actually...
Nope!
A better analogy would be when big tobacco bought up the supply of smaller brands, sat on them for months, then resold the (now stale) product, ruining their reputation. Except the economics of that don't work on Teslas.
In Michigan it's not easy to become a dealership (not a franchise -- they can't sell cars).
You first have to join the dealer trade association. Then you have to apply to become a franchise with the state. The Secretary of State decides your initial market area that you are allowed to cover. If you don't belong to the dealer trade association, you immediately are not given a territory, and most likely won't be approved by the State. In order to get your dealership license, you also have to have a setup for service, dollars spent, setup with the SOS for tab registration, etc. Essentially you have to dump a ton of money into the location right away -- in essence a huge barrier to entry for anybody starting up.
How are the standards to be enforced then? Right now dealerships must renew their license on a yearly basis, all at the same time, greatly simplifying oversight. A standard without enforcement is useless. Musk needs to acknowledge the need to sell vehicles through dealerships because that is how real people find cars. If he ever wants to be an actual production model not a media hype story that is, but maybe he only wants the hype not business success after all the tax rebates end. Right now his model is that of the for-profit universities selling sub-par offerings because the US Federal government is funding part of it and has inadequate review.
So what if Tesla has a larger mark-up than other manufacturers? Are you arguing that this is immoral? What level of margin is moral, then, in your eyes?
The key point is that would-be drivers have plenty of choice of cars. They don't have to go with Tesla. Dealers are no longer a force driving down prices, even if that's what they were originally intended to be. They are third party intermediaries who drive prices up and make the market more complex, not less.
Eh? The legislative process is influenceable by reference to external events (and internal processes), and while that may include lobbying, taking out ads in newspapers, writing to your legislators, etc etc, it also includes having regard to courts striking down laws as unconstitutional and having regard to court awards for damages against individuals and institutions.
I believe what the OP is on, is "sarcasm". It wasn't that hard to spot.
Foreign corporation?? Tesla is headquartered in California, and the main exchange they are listed on is NADAQ. Tesla motors =/= the former soviet company...
Additionally it would be stupid for Tesla not to incorporate any stores in the states they are in because foreign corporations are at an disadvantage legally, it would be trivial for Tesla to draw up the legal agreements Michigan requires for franchised dealer, but Tesla doesn't want to be a franchised dealer, they only want to sell cars and the two aren't the same thing.
They tried this, and got denied. Now they're suing.
+1 Whoosh
McDonald's isn't a unified company. The main company sells franchises, which are effectively separate businesses with very extensive contractual ties, which is not that different from how car dealerships work.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
Lawsuits can be an effective way to find out what the law means. In this case, the question is about laws superior to state statutes and whether they mean it's illegal to ban direct sales.
"When you have eliminated the unacceptable, whatever is left, however improbable, must be the truthiness" - Holmes
Car dealers are often the largest payers if sales taxes at the Municipal and sometimes even the state level. Long story short if people buy vehicles online it can cause problems in terms of lost revenue.
I hadn't tried but that was because I was at work and was browsing Slashdot while waiting for Visual Studio to finish installing. I saw someone mention something interesting and asked for further information so I could read up on it later. No time for research right then but that doesn't mean I'd pass up an interesting read if someone could offer me one.
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Well, I didn't read TFA and wasn't aware it covered the story of how car dealerships got where they are today. TFS didn't seem to suggest that it did.
USE HOT GRITS WITH STATUE OF NATALIE PORTMAN (NAKED AND PETRIFIED)
Most mcdonalds are franchised yes but some are directly operated by them. That's besides the point though. They're not legally forbidden from doing it. There's no law that says fast food companies MUST operate through franchises.
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The law could probably be changed if you where prepared to throw more money at it than the dealership lobby guys.
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Sorry, but you've already been judged guilty of heinous crimes in my courtroom. I built it out of legos by my sofa. I'd upload a picture of the judgment - it's a really good scene, but my Geocities webpage isn't working at the moment.
As to your request, unfortunately, I don't have any ideas or links. But keep in mind that we're speaking of one of the sleaziest business schemes ever developed by man. It's not surprising that they're a protected ecosystem.
How are the standards to be enforced then? Right now dealerships must renew their license on a yearly basis, all at the same time, greatly simplifying oversight. A standard without enforcement is useless.
By making corporate owned showrooms also renew their licenses on a yearly bases, all at the same time? Though if all dealerships renew their licenses at the same time, I don't see how there can be any effective oversight, they should be staggered throughout the year so the government inspectors have time to actually enforce their standards. Assuming, of course, that they do any standards enforcement at all.
Musk needs to acknowledge the need to sell vehicles through dealerships because that is how real people find cars. If he ever wants to be an actual production model not a media hype story that is, but maybe he only wants the hype not business success after all the tax rebates end. Right now his model is that of the for-profit universities selling sub-par offerings because the US Federal government is funding part of it and has inadequate review.
You can make arguments about whether or not his business model will succeed, but that's a different argument than "The government should force Tesla to use franchised dealer networks".
Being allowed to sell something isn't a right, it's a privilege. One that Tesla doesn't have.
Why doesn't tesla have the right yet McDonalds, Apple, Slazenger and a jillion other companies do?
They don't have the right either - they have the privileges.
Pfft whatever. Same question though.
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This dealership system is as corrupt as the voting system that the GOP and DEMs control, blocking any competition thry don't like such as Bernie Sanders and Jill Stein. Either candidate would be a thousand times better than Trump or Clinton, and Tesla and SpaceX are each fighting an uphill battle against a wholly corrupt system bent on maintaining the status quo rather than allowing the best man, woman, or company to prevail. If you follow what's been happening with SpaceX, it mirrors the struggles with Tesla perfectly... companies charging many times more for the same service as SpaceX can provide, trying to keep the new kid on the block from spoiling their decadent pay-for-play racket. Three cheers for Tesla, SpaceX, and Elon!
Unless you are the state Which is selectively shitting on intertsate commerce. The government love to prarade around the 14th protections.
Film companies don't have the right to run their own cinemas. Different industries have different regulations. What we really should be asking is, what benefit is it to Michigan to reduce the percentage of the cost of a car that stays in the state? You can't even cry about the free market because Tesla gets so many subsidies.
Most building dealers are called real estate agents - buildings are generally attached to land, and for those not they are sold at retail.
You do know that dealers don't make money on new car sales, right?
If that were true, dealers would be happy to sell you cars near/at/below invoice cost. Even if they sell you the car at invoice, the factory incentives still mean the dealer turns a profit. Nonetheless, they try to sell cars for MSRP or even with added dealer markup, because that maximizes profit.
Their business model is not quite the same as printer companies that sell printers for tiny margins and count on consumers buying high-margin ink cartridges.
There is indeed such a right, but the right is being violated by crooked politicians.
OK bad example then. But you are still able to buy and sell houses without real estate agents. So I guess it's an example of a market that doesn't force a "dealer", but allows both purchasing through a direct sale and through "dealers".
This is the podcast that got me interested. Yes, NPR Planet Money (sounds really boring) but it's actually pretty good!
Thanks, I'll check it out later.
USE HOT GRITS WITH STATUE OF NATALIE PORTMAN (NAKED AND PETRIFIED)
I'd like to open a dealership and sell brand new houses, but builders refuse to let others sell their products.
Nonsense. Any builder will sell you his house and you are free to then sell it to anyone else as you see fit. In fact, if you wanted to buy 10 houses, the builder would probably even give you a discounted price per house.
On January 9, 1911 Henry Ford won an eight year legal battle, the prize? The right to manufacture automobiles.
The antagonist of this saga is the Association of Licensed Automobile Manufacturers, ALAM. Through litigation George B Seldon and the Electric Vehicle Company obtained licensing rights over automobile production. The granting of licensing rights was contingent on memberships, royalty rates, and unanimous approval of the ALAM executive board.
1903, Ford applied for membership and was denied "due to his past business failures". Coincidentally, Ford's Detroit manufacturing would conflict with an executive board member's sales territory (at a time when cars were the domain of the rich, Ford wanted to mass produce an inexpensive alternative). After his second application denial, Ford began production anyways. On October 22, 1903, the ALAM filed suit claiming the 1895 Selden patent covered all gasoline-powered vehicles. After a grueling legal battle, Ford, of course -- lost. It wasn't until the U.S. Second Circuit Court of Appeals that the ruling was overturned.
The ruling found that Seldon's patent only covered cars manufactured to his specifications -- none of which had ever been produced. Thus ended the protections of a man who had never furthered the knowledge of the American manufacturing. Or, as Ford put it "No man has a right to profit by a patent only, that produces parasites, men who are willing to lay back on their oars and do nothing. If any reward is due the man whose brain has produced something new and good, he should get enough profits from the manufacture and sale of that thing."
Foreign corporation?? Tesla is headquartered in California, and the main exchange they are listed on is NADAQ. Tesla motors =/= the former soviet company...
Silly rabbit, a company incorporated in California is just as foreign to the state of Michigan as a company incorporated in the Soviet Union! They would even have to petition court to file suit against a Michigan Resident. I would bet a dollar to a donut hole that Tesla is incorporated in Delaware anyway.
Apocalypse Cancelled, Sorry, No Ticket Refunds
The same can be done with a Tesla. But what you lack is the ability to sell it as a "new" car/house, since it officially had a previous owner.
Actually at one point they DID do precisely that. They even had their own 'stable' of artists that much like baseball were groomed early on, given small parts to learn their art and then turned into stars (eg kurt russell). The government stepped in and made it illegal. Thus the shit show that we have now with regards to cinemas. Thankfully that is changing and smaller film makers can sell directly to the gen public via alternate means ;)