Will Tesla Motors change the car sales paradigm?

[mjr]

I'm not sure how many of you are familiar with Tesla Motors, but they offer all-electric cars.

They basically don't have dealerships. They have a website, and some places have what are essentially "stores" or kiosks. In fact, a mall near where I live has a Tesla store, where you can actually go and sit in one.

These cars are impressive to me. Unfortunately, I don't have $110,000 just laying around to buy one.

That said, I think they might change (at least somewhat) the car sales paradigm.

How, you ask? Well, as I said, there are no traditional "dealerships". It's "just in time" (or JIT) as far as I know. This all but cuts out the "middle man". So if you wanted one, you could go on their website, customize your car, pay the deposit, and then they build your car for you, and you pick it up at a later date (though I think they can ship it to you).

It would be similar to going to a car manufacturer's website, and customizing and ordering a car directly from them.

Of course, what I think would happen is you'd have the "major" car companies reduce their inventory significantly, so that if you NEEDED to purchase a car that day, and couldn't wait the length of time it would take to custom-make your car, you could. So instead of having, say, 200 cars on your lot of various makes and models, you might have 2 or 3 of each make/model.

Under this paradigm, you could probably lower the price of cars some, and still turn a profit.

Of course, the dealerships and sales people wouldn't like it.

Thoughts?

[Kheldarson]

Of course, the dealerships and sales people wouldn't like it.

Thoughts?

They don't like it. If I recall, North Carolina was looking at, or being lobbied to look at, changing a law that would require car manufacturers to have a dealership...effectively preventing Tesla from doing business in their model.

[wolfie]

NC isn't the only stumbling block - a couple days ago I read that Michigan has legislated that automakers are only allowed to sell their product through franchised dealerships.

That's a big part of what's wrong in America - entrenched players have built their business around an obsolescent model. Someone new comes along with a more efficient model, and the reaction of the entrenched players is to buy legislation to force the use of their model.

[Greenday]

All the major car companies are paying off legislators to pass laws to prevent Tesla from using their successful business model. God forbid they have to change and get rid of the dog and pony show that is a dealership.

[TheHuckster]

When I'm making a car purchase, I want to make sure I'm spending the thousands of dollars I am about to spend on something I want. I want to give the car a test drive, make sure it runs as I want it to. This is even more important if I'm like a good portion of car buyers who buy preowned cars, which could have some serious flaws.

So, no, I don't think dealerships are obsolete. I want to see and touch what I'm purchasing when it's a car.

That said, just as with most situations, lobbying to protect a business model that the buying market doesn't want is not the right solution.

[HYHYBT]

You would still see and touch one just like it, with perhaps different options.

Dad got a new pickup truck that way about ten years ago: tried out one they had on the lot, then ordered one exactly the way he wanted. That part's not new, even if his did come through a long-established local Ford dealership.

[protege]

When I'm making a car purchase, I want to make sure I'm spending the thousands of dollars I am about to spend on something I want. I want to give the car a test drive, make sure it runs as I want it to. This is even more important if I'm like a good portion of car buyers who buy preowned cars, which could have some serious flaws.

You're not the only one. If I'm dropping several grand on an item, I want to make damn sure it does what it's supposed to. I'd rather find out that the handling sucks up front, instead of after delivery...and I'm stuck with it.

Even so, I don't think that trying to protect the old way of doing things is what we really need. Dealers (and the automakers too) aren't going to change unless they're forced to. If they had their way, we'd still be buying ill-handling, huge land yachts that get shitty mileage. They lobbied for import taxes on Japanese vehicles, which, in the end...backfired. Many imported brands soon set up factories here, and then the domestics had to start making smaller vehicles.

[Andara Bledin]

Tesla has showrooms and does test drives by appointment at either a store, or at an event.

The issue isn't that Tesla doesn't have dealerships; they do. It's just that Telsa dealerships are owned by Tesla, not franchised out through some third party who then drives the prices up to get a piece of the pie.

Texas has a law against manufacturers selling direct, and that probably weighed quite heavily against them when it came time to decide where to build the gigafactory. Of course, not allowing them to have stores in the state does pretty much nothing to stop Texans from buying Teslas. The point of sale is just listed as California, then it's shipped and registered in Texas and there's nothing the state can do to stop it. Meanwhile, California is getting all of the resultant sales tax because this is where the sale is taking place.

I can't wait for the Model 3... I probably won't be able to afford even a $30,000 Tesla, but a girl can dream...

[Tama]

This will probably end like blue laws did in my area, states will realize how much tax revenue they are losing.

[Gravekeeper]

Telsa are awesome. Drive it home, plug it into a outlet. Get some solar panels = free gas. Tesla charging stations are also all free. Durable as fark too.

I think only two people have ever managed to kill themselves in a Tesla. One in a high speed chase not wearing his seatbelt and another that drove it off a cliff into the ocean. >.>

It would be similar to going to a car manufacturer's website, and customizing and ordering a car directly from them.

In fairness, this is kind of the norm with European manufacturers. Direct from factory delivery, etc. Volvo, BMW, etc you can just order direct from them. Volkswagen will even let you come to their awesome Phaeton factory and pick out fabrics and what not then let you watch them build your car. 2 days later you come back and drive if off the factory floor.

Smaller/Independent car companies do similar things in North America. Its only big companies in the US that are desperately clinging to a 1950s business model and relying on political lobbying to try and protect it against market forces.

[Andara Bledin]

I only know of the one death from the car thief/high speed chase, and he was ejected after hitting a pole so hard the car was split into two pieces.