If Tesla Motors chief Elon Musk was an I-told-you-so type of guy, here's his chance to do so. It turns out that plug-in vehicle buyers are generally less satisfied with their dealership experience than conventional-vehicle buyers. And the dealers themselves don't like the process much, either. So says a study from the University of California, Davis.

The report cited 43 interviews with automakers and dealers that sell in California as well as the JD Power 2013 Sales Satisfaction Index. The study found customer-satisfaction scores to be "much lower" for plug-in vehicle buyers than others. Maybe that's because the dealers themselves are less patient and find that selling plug-ins are more time-consuming, labor-intensive and stressful. And that's just getting the car out the door. More complications arise when dealing with the federal tax incentives issue.

Of course, Tesla scored well, relative to the other dealerships. And all that gives more credence to the company's insistence on selling its vehicles directly to customers and without a third-party dealership network. Representatives of some of these dealership groups have been lobbying against the prospect of Tesla getting direct-sales rights. Michigan is the latest battleground between Tesla and pro-dealership entities. See below for an abstract on the UC Davis report and then read more here.
Show full PR text
New Car Dealers and Retail Innovation in California's Plug-In Electric Vehicle Market

Innovative new products like plug-in electric vehicles may need new approaches to market and sell them. We conducted 43 interviews with automakers and dealers selling plug-in vehicles in California's major metro markets and analyzed data on customer satisfaction with new car dealers and Tesla stores. Initial findings revealed:
• Plug-in vehicle buyers rated the dealer purchase experience much lower than conventional vehicle buyers while Tesla earned industry-high scores;
• Plug-in vehicles returned higher gross profits but place greater demands on dealers, including the provision of support services beyond traditional offerings;
• New retail approaches undertaken by 'dealer innovators', including new methods for building and scaling dealer competence, could improve the PEV buying experience; an
• Public incentives could better align with established dealer practices and business drivers to improve program effectiveness.
Evidence suggests that pre-existing retail configurations and arms-length relations in the traditional franchised dealer model could both enable and hinder retail innovations for PEVs, as well as the quality and pace of diffusion amongst dealers and customers. The paper examines the implications of these findings for policy.

Share This Photo X