Electric Car Maker Tesla Opens Store In Miami Mall
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Nicholas Craan (L) and Francesco Campoy look at a Tesla motor company car in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: People walk out of a Tesla motor company dealership in the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Gaelle Freer and her son Alexander LeVaillant Freer look at a Tesla motor company car in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Marcelo Jaramillo, assistant store manager, (2nd R) shows a Tesla motor company car in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: People walk past a Tesla motor company dealership in the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Tesla motor company accessories hang from the wall in the recently opened dealership in the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: People walk in a Tesla motor company dealership in the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: A Tesla motor company car is parked in a dealership in the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Tesla
  • The Tesla showroom is shown at the Washington Square Mall, Friday, July 20, 2012, in Portland, Ore. Tesla Motors only has 24 stores in the world, and now one of them is at Washington Square Mall in Portland. The company produces electric cars and hopes their product will be a hit with eco-conscious Oregonians. The cars can go from zero to 60 mph in less than six seconds, all without a drop of gasoline. (AP Photo/Rick Bowmer)
  • Image Credit: ASSOCIATED PRESS
  • Amsterdam: Model S @ Tesla Store
  • Amsterdam: Model S @ Tesla Store
  • Image Credit: Flickr
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Marcelo Jaramillo, assistant store manager, (R) shows a Tesla motor company car in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Gaelle Freer looks at a Tesla motor company car in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Electric Car Maker Tesla Opens Store In Miami Mall
  • MIAMI, FL - JUNE 06: Marcelo Jaramillo, assistant store manager, (R) explains how the Tesla motor company car works in a dealership at the Dadeland Mall on June 6, 2013 in Miami, Florida. The electric car maker is trying to make a move by selling their cars, that can cost between $62,400 and $82,400, into malls and stores. (Photo by Joe Raedle/Getty Images)
  • Image Credit: Joe Raedle via Getty Images
  • Amsterdam: Model S @ Tesla Store
  • Amsterdam: Model S @ Tesla Store
  • Image Credit: Flickr
  • Amsterdam: Tesla Store
  • Amsterdam: Tesla Store
  • Image Credit: Flickr
  • Eindhoven: Tesla Store
  • Eindhoven: Tesla Store
  • Image Credit: Flickr
  • There is a Tesla store inside this mall...
  • There is a Tesla store inside this mall...
  • Image Credit: Flickr
  • DC Tesla Store
  • DC Tesla Store
  • Image Credit: Flickr
  • New Tesla Motors store
  • New Tesla Motors store
  • Image Credit: Flickr
  • Tesla store
  • Tesla store
  • Image Credit: Flickr
  • Tesla Tyson's
  • Tesla Tyson's
  • Image Credit: Flickr
  • Tesla
  • A Tesla Model S is shown in the showroom at the Washington Square Mall, Friday, July 20, 2012, in Portland, Ore. Tesla Motors only has 24 stores in the world, and now one of them is at Washington Square Mall in Portland. The company produces electric cars and hopes their product will be a hit with eco-conscious Oregonians. The cars can go from zero to 60 mph in less than six seconds, all without a drop of gasoline. (AP Photo/Rick Bowmer)
  • Image Credit: ASSOCIATED PRESS
Tesla took two more steps towards being allowed to sell its vehicles as it chooses (that is, direct to customers) this week. Legislative efforts in New Jersey and New York both gave the California automaker legal permission (or near permission) to operate its stores. It's gotten so bad – or good, depending on your views, that other automakers are starting to speak up.

Yesterday, Tesla got official permission to keeps it five stores open in New York thanks to the signature of Governor Andrew Cuomo on a pro-Tesla bill that passed earlier this year. This is not a surprise. The bill also makes it difficult for any other automaker to operate its own stores in the state.

Other automakers are now saying that the dealers have too much power.

In nearby New Jersey, the state Assembly voted yesterday to allow EVs to be sold directly to the consumer. This vote follow an Assembly committee's vote earlier this month and the bill now moves to the New Jersey Senate and, if it passes, would need to be signed by Governor Chris Christie before becoming law. You may remember there's a bit of bad blood there. This is all quite a turnaround from mid-March, when the state legislature voted against direct sales. If passed, Tesla would be allowed to operate four stores in the state.

As you can see, progress is being made. And that's changing the battlefield. The National Automobile Dealers Association (NADA) released a new package of pro-dealership information called "Get the Facts: The Benefits of Franchised Auto Dealers" to take the other side. NADA says that the "current franchised new-car dealer model has benefited consumers, manufacturers and local communities for nearly a century" and then lays out its reasons why. You can watch the NADA's short Get The Facts video below.

Perhaps most interestingly, other automakers – through the Auto Alliance – are now saying out loud that the dealers have too much power. In a statement to Automotive News, the Alliance said, " When we look at the big picture, we may be at a tipping point. If dealer groups continue their push for more onerous franchise laws, we will be forced to keep an open mind about how best to serve new-car buyers in the future." That was enough to scare the chairman of the Automotive Trade Association Executives, who told AN that, the Alliance coming out against the franchise system was a "recipe for disaster."



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    • 1 Second Ago
  • 194 Comments
      Letstakeawalk
      • 11 Months Ago
      "" When we look at the big picture, we may be at a tipping point. If dealer groups continue their push for more onerous franchise laws, we will be forced to keep an open mind about how best to serve new-car buyers in the future." That was enough to scare the chairman of the Automotive Trade Association Executives, who told AN that, the Alliance coming out against the franchise system was a "recipe for disaster." Of course the automakers would like to dump the franchise system - they've been trying to do it for decades.
        purrpullberra
        • 11 Months Ago
        @Letstakeawalk
        And they deserve our help. Will you help destroy dealerships with us? Join the fight!
      b.rn
      • 11 Months Ago
      I used to work for a large automotive group. I wasn't in sales, but watched the sales people work. Sometimes customers would try and bid one dealer against another. What they didn't know is that we owned both dealerships in the bidding war. Bidding us against ourselves is not competition. I've also watched dealership groups consolidate. Fewer and fewer enterprises are owning more and more dealerships. Competition is decreasing.
        Dean Hammond
        • 11 Months Ago
        @b.rn
        apparently taking away any form of negotiation is what Tesla wants...and most of the posters here...one comment I found interesting, a guy shopping 35 Ford dealers to get a "break" on the limited production Raptor, apparently that was a bone of contention, but being unable to get a break on a tesla because its "factory direct" is ok??????????????????????? huh?....
          Dean Hammond
          • 11 Months Ago
          @Dean Hammond
          @purpullberra...seek help young man....
          Letstakeawalk
          • 11 Months Ago
          @Dean Hammond
          "Tesla doesn't markup their own product before selling it direct..." OMG. https://www.youtube.com/watch?v=_n5E7feJHw0&feature=kp
          raktmn
          • 11 Months Ago
          @Dean Hammond
          If the Model S were sold through dealerships, they would still have $20,000 dollar "market adjustment" stickers over MSRP. It is like you don't even remember the Volt rollout at all, and all the markups for months at all. And (sorry Volt fans) but the Volt isn't half the car that Tesla is, with nowhere the supply/demand issues as the Volt.
          elctrNmbliT
          • 11 Months Ago
          @Dean Hammond
          The reason you don't get a "break" on a Tesla is because of the very definition of what a "break" is. A break is when you find a dealer that is willing to give you a "break" or the smallest markup from the factory price. Tesla doesn't markup their own product before selling it direct so they can bargain with you on lowering the price. The price is what it is and if you don't like it you don't have to go to another dealership with a different markup you would just shop for another brand like every other product in the world. If I don't like the price and features of my Apple phone I don't go to a different Apple dealer to haggle on the markup I just simply buy a Samsung Galaxy instead. It's really that simple. It's not complex. No matter how many examples you try to post on this board the outcome is always the same.
          purrpullberra
          • 11 Months Ago
          @Dean Hammond
          If you can't see why the words you wrote make you sound retarded then you have a negative IQ score.
      RocketRed
      • 11 Months Ago
      I won't cry for dealers if automakers can sell direct. But it's a little lame for manufacturers to claim that they are looking out for consumers here. The manufacturers benefit from aggressive, often crooked dealers to move their cars. It's not like it hurts automaker X because someone feels ripped off, because every automaker is following the same model of sales. The manufacturers have a body of highly motivated sales people, and they don't get their hands dirty or expose themselves to complaints about the sales process. If the manufacturers had the exclusive right to sell online, then there would be a set price for every model for a region. Would the manufacturers pass on the savings to you or just charge even more than current MSRPs?
      Zoom
      • 11 Months Ago
      " pro-Tesla bill that passed earlier this year. This is not a surprise. The bill also makes it difficult for any other automaker to operate its own stores in the state." I can already see the legal challenge here. Why does Tesla get special treatment relative to other automakers. I can't wait for the Supreme Court to finally rule against the dealers. And yes, this is a Federal issue, carmakers are national firms and the Commerce Clause should apply because they are being hampered by 50 different state laws.
      EVSUPERHERO
      • 11 Months Ago
      The auto manufacturers won't mass produce EV's but they are right their to jump on Tesla's ground breaking process for their advantage. They are parasitic on Tesla and now with the open patients, they may even find a way to slow EV progress, again.
      MMM
      • 11 Months Ago
      GO TESLA!!!
      Matt Mossberg
      • 11 Months Ago
      I don't know either to laugh at the video for its crystal clear misinformation lying and deception or get frustrated that many non informed people will see this and believe it. The funniest thing about the video to me is how it portrays salesmen and dealerships as this wonderful and nearly magical place where they treat every single consumer oh so well and do everything they possibly can to get the best deal. and out of their good will spend time on the hundreds of pages of the contract and warranty so the lil old customer doesn't need to fret over any of the 'very clear, non legal jargon, definitely not screwing over the consumer over' paperwork so buyers can get in and out in a jiffy and enjoy their new car.... that they could not have got pressured in anyway to get any needless equipment or extras because salespeople are always the kind of people that will bend their backs for you out of the kindness of their hearts and are always super duper educated about all the cars they sell!!!
      knightrider_6
      • 11 Months Ago
      Here's my question for NADA If a automaker owned showroom has same costs (retail space, test drives, tradeins) and cars sold there will cost same or more compared to an franchised dealer, then what are you worried about? If you can offer better price, and better services, customers will come to you. Think about it this way - if Best Buy can offer better price and better service than Apple Store, why would people visit Apple Store?
        express2day
        • 11 Months Ago
        @knightrider_6
        One has to assume that NADA's concern is not about one or two or a few manufacturer owned showrooms but rather that manufacturers would eventually want to take over most, if not all, retail facilities and thereby put most, if not all, dealerships out of business. The threat to consumers is that manufacturers would then be able to reduce or eliminate competition among the brand(s) they handle and treat the retail outlets as profit centers. Given how big business operates, they would probably be worse than typical dealers when trying to make money off consumers at the local/regional sales facility level. The threat is also not Tesla, it’s the direct sales system that Tesla is trying to push that opens the door for other manufacturers. If manufacturer sales outlet ownership were to be a Tesla-only thing, dealers and the NADA probably wouldn't care.
      Technoir
      • 11 Months Ago
      [coming out against the franchise system was a "recipe for disaster."] What kind of disaster? Happy people getting better treatment and potentially lower prices? How many will miss the sleazy dealers?
      SLT
      • 11 Months Ago
      It seems like the "middle man cost" is improperly defined in every one of these arguments. The extra middle man cost is not the cost of running the dealership as this can be comparable to running a factory service center (although I doubt it is). The extra middle man cost is the extra profit a dealership strives to make to put directly in their pockets. The price the manufacturer sells a vehicle to a dealership for should be the true market price of that vehicle. It is sad when people loose their jobs, but any economics major on the planet will tell you it is not a good idea to keep jobs that are obsolete.
        express2day
        • 11 Months Ago
        @SLT
        You don't think manufacturers will want their sales/service facilities to be profit centers too??? We're talking major corporations here, of course they will. Seeing how "big business" operates they will probably be more aggressive about those profits than typical dealers.
          raktmn
          • 11 Months Ago
          @express2day
          express2day -- here is where you completely don't understand any of the legal actions that Tesla is involved in right now in any state. None of the court cases they have won, none of the regulatory rulings that they have won, and none of the laws proposed, have had ANY impact on ANY current car maker/dealership. I bet you don't even realize that only approx. half the states currently even have ANY franchise laws! If you think having Tesla carve out state exceptions for themselves in the states that have laws is some kind of impending doom for all dealerships, what about all the states who don't have ANY laws at all.
          express2day
          • 11 Months Ago
          @express2day
          @raktmn This is NOT just about Tesla. It is about any manufacturers being able to follow suit which would not be a good thing for consumers. If GM, Ford, Chrysler, Toyota, etc. were lobbying for direct sales outlets, my comments would be the same.
          raktmn
          • 11 Months Ago
          @express2day
          Yea, having their service centers not be profit centers would be as crazy as Tesla completely opening up all their patents as open source to all their competitors!! No car company would ever do stuff like that, all car companies are the same. Crazy, never gonna happen... http://green.autoblog.com/2014/06/14/what-does-open-patents-deal-mean-for-tesla-bmw/
      • 11 Months Ago
      The only direct benefit to the consumer that dealerships bring is service and repair being local. I wouldn't want to own a car that I had to spend 2 days travelling to get the car serviced. Where I live, all the major dealers have local shops. Tesla does not. That convenience gives me the incentive to buy from them traditional shops. But to say that Tesla cannot take care of their customers is unproven and conjecture. If the cars meet the safety laws the other guys have to follow, then they should be allowed to sell their cars. The cronyism and cartel seeking from Government to reduce natural market competition needs to end from corporate America establishment. Let the market decide.
        Weapon
        • 11 Months Ago
        The reason why Tesla can't have local locations is because dealership laws are blocking them. Tesla wants to make local locations, they just want to own those locations and not franchise it. If you live too far from a service center, Tesla would send a person to your house with a loaner and you use the loaner while Tesla takes your car in for maintenance.
      Julius
      • 11 Months Ago
      I love all the "anti-dealership" comments on here. Given the logic, I wonder if these same folks would say the same about ALL retail. Why go to Pathmark, Kroger's, BestBuy, Gap, J.C.Penney or whatnot when you can get it for less shipped direct from the manufacturers and farmers? Because by definition, each of those companies suck money from the hands of the consumer. Hey, imagine the money we as Americans can save by eliminating all those useless retail jobs, right?
        no1bondfan
        • 11 Months Ago
        @Julius
        Bad examples - Kroger's sells a lot of in-house brands, as does JC Penney. Everything at the Gap retail store is from the Gap company. Why can Gap have retail outlets to sell their own clothing, but Tesla (or Chevy or BMW, etc.) shouldn't?
        mycommentemail
        • 11 Months Ago
        @Julius
        Each of these companies do take a cut, thereby increasing the final cost of the product. Whether that is bad (or even avoidable) is another story. But they most definitely charge money for their services. I think you are conflating a number of variables in making your comparison though. The retailers you mention all sell small ticket items. Automobiles are big ticket items. In other words, an automobile is a large enough purchase (and with a small enough set of competitors in the same market) that you can afford to have a single retailer sell just a single brand. That stands whether we are talking about dealerships as they exist now OR company owned stores. A grocery store, on the other hand, sells a whole collection of "unrelated" items at a small price. "Unrelated" meaning coming from disparate manufacturers. Imagine each company making jam having to open up a separate retail establishment over and over all across the country just to sell a $2 bottle of jam. That said, the above scenario isn't completely without precedent. Bakers would have their own "factory" stores back in the day (still do in my neighborhood). The prices aren't any lower but that is a function of them being in a different market (i.e. my local baker sells the "Mercedes" of bread while my local supermarket is selling the Nissan Versa of bread). There is no law that stipulates that the baker cannot open their own bakery AND sell via supermarkets. And in fact, that is exactly what another local baker does. It is a similar story for farmer's markets. They operate here every weekend and once during the week. These farms sell directly to consumers AND they sell to the local (and not so local) distributors. There is no law preventing them from doing that. The reason there is no law is that the distribution model that exists now (small manufacturers selling via an independent 3rd party) is one that works better for most Americans. Most of us (myself included) wind up buying at a supermarket because it is simple and convenient - a real value added. But even that is changing with the internet as more and more companies are selling directly to the consumer. But even there it is limited. I would buy a computer directly from the manufacturer because it is, again, a big ticket item. I wouldn't buy a can of tomatoes that way. It is too difficult to find the website. I use Amazon instead (which is simply an online, 3rd party dealer). Both of these examples are models of selling many, small ticket items. And neither of them require any onerous dealership laws. Now, keep the following in mind: People think that if the dealerships went away, all the overhead that we pay to them would go away too. But that is incorrect. If a manufacturer were to have a showroom open, they would have to incur many of the same overhead costs that a dealer would. Still, that does not imply we need special protection for this one particular type of retail when nobody else gets it.
          Julius
          • 11 Months Ago
          @mycommentemail
          It's not conflating if people are comparing Tesla to buying a $99 iPod shuffle at the Apple store vs. at BestBuy. And as for convenience, single-brand dealerships are fading away. Why wouldn't a multi-brand dealership provide the same level of convenience in cross-shopping as a supermarket? In any case, I'm just fine with dealers dying the same way that Borders lost to Amazon. My biggest complaint is that Tesla gets special dispensation where Nissan selling the Leaf does not.
        raktmn
        • 11 Months Ago
        @Julius
        People do exactly that all the time. They are called "Outlet Malls", and direct order off of manufacture websites, and farmer's markets. Like a Sony item in Best Buy? You can goto Sony.com and order it directly from Sony. Like your local peaches? Buy them from a farmer's market instead of Kroger's. Nobody cries like little babies about the existence of Outlet Malls, and direct manufacture sale sites, and farmer's markets, etc. So why all the sudden whine about it for automobiles?
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