




 Tesla Model S

Sources: News Observer, Slate

Comments     Threshold


RE: lolwut?
By Mint on 5/14/2013 1:38:50 PM , Rating: 2
That's a pretty good explanation. Thanks.

I do suspect that there will be a lot of potential chaos in transitioning to a dealer-optional system. Manufacturers still have incentive to provide showrooms for test drives and trying out features, but they may have a very different payment system as opposed to the current commission based one.

Dealers would be screwed for a while as customers use them for test drives but then buy direct at a lower price. Only when they start closing down and impacting sales will manufacturers support them.

RE: lolwut?
By Brandon Hill (blog) on 5/14/2013 1:58:54 PM , Rating: 2

They could get lessons from Amazon shoppers using Best Buy as a showroom ;)

RE: lolwut?
By boobo on 5/14/2013 11:16:46 PM , Rating: 3
To be fair, people who buy in brick and mortar stores will often go to Amazon to check product reviews.

RE: lolwut?
By somedude1234 on 5/15/2013 5:38:25 PM , Rating: 2
I did exactly this earlier today!

Specifically, I was in need for a new wireless router so I researched online, checked out reviews on Newegg, Amazon and elsewhere. Then I checked out prices locally and online and decided that the price at my local Fry's was competitive enough to justify a short drive to pick it up today. Sure I could have ordered it online and maybe saved $5-10, but I have the kit today and that was worth it to me.

Also, I got to overhear one of the Fry's guys explaining router choices to a different customer while I was there, and thought two things:
1. That guy actually knows a little bit about what he's talking about, so refreshing for a modern electronics retailer (cough, Best Buy, cough).
2. Even so, I'm glad I researched online instead of trying to decide which one to get while I was here in the store.

RE: lolwut?

RE: lolwut?
By BRB29 on 5/14/2013 2:09:11 PM , Rating: 2
If Tesla can set up a network maintenance and repair shops, then I assume setting a sales office with test cars is much easier.

A small office with 5-10 vehicles outside ready for test drives all day. If you want to buy one, then you can build it online or in the store itself. Financing can be done by just about any banks now and they can have a kiosk there also.

The direct order system actually ends up saving automakers a massive amount of production costs. There's less waste because they usually have to guess how many of which trim and options to equip since most are prebuilt. Demands for vehicles are also 100% predictable as they have data immediately.

I think dealers were a good intention back then but it is becoming increasingly irrelevant now.

An efficient business model would be:
Instead of reselling vehicles. They should turn themselves a service center for repairs/maintenance and warranty work. They can charge automakers for rent of using their office and parking lot to giving customer test drives.

This model is much more efficient as it takes the liability away and income is predictable. Service work actually generates more cash flow than selling vehicles now.

Why is this model more efficient? What people don't realize is that dealers didn't pay for any of the cars. They work on a line of credit. So essentially, it's the bank's money. The interest is high because its risks are high. That's why dealers are very eager to get vehicles off their lot when it's been there a while. The owners of dealerships don't really care because he takes money home every month. But if the businesses loses millions and close, he is not liable since all liabilities dies with the corporation. His millions are secured in his personal accounts and he just open another dealer.

Home developers do the same thing.

RE: lolwut?
By lelias2k on 5/14/2013 3:02:29 PM , Rating: 3
Now, back to Tesla:

Tesla's ability to sell units will be limited if it can not have units and maintenance facilities in places where people want to buy them.

Then they are the ones who should be worried, not the government, wouldn't you agree?

RE: lolwut?
By BRB29 on 5/15/2013 7:36:33 AM , Rating: 2
EVs actually have very low maintenance because there's barely any moving parts. Conclusively, they don't need as many maintenance shops for the same amount of vehicles. It also looks like they designed their cars to be more on the modular side where you can easily swap part.

I'm also sure modern mechanics can adopt to fixing EVs since it's easier than ICE cars.

RE: lolwut?
By lelias2k on 5/15/2013 5:11:42 PM , Rating: 2
I honestly have no clue how my answer ended up on your post. I was replying to another post. Go figure.

But yeah, your points are spot on.

RE: lolwut?
By wiz220 on 5/14/2013 3:10:56 PM , Rating: 2
I see no reason why you couldn't have a store (like Tesla has) that was big and offered test drives. You can have a dealership-like experience without the "dealer" it would just be a store built, maintained and run by the car company. The consumer might save money since there would be no middle man. That setup might work better for some companies and not so much for others, I think the main point is that there is zero reason for it to be legislated (aside from protectionism of course).

