Print 54 comment(s) - last by overlandpark.. on Mar 26 at 10:59 PM

They want to stop the automaker from building new store locations

Tesla Motors just can't catch a break with this auto dealership fight as New Jersey recently banned direct sales, and now Ohio is looking to do the same. 
According to The Detroit News, Ohio auto dealers are supporting a bill that would stop Tesla from opening stores outside of its only two locations in Ohio.
Tesla currently has stores in Cincinnati and Columbus, where direct sales are allowed. The automaker was granted this authorization when Republican Gov. John Kasich -- through the Bureau of Motor Vehicles -- issued Tesla a license to do so. 
But auto dealers believe that Tesla's direct sales model could branch out to many more locations, and eventually, other auto manufacturers could even follow suit. If this were to happen, auto dealers would be out of a job. 
Ohio auto dealers took legal action against Tesla's two stores, but it didn't fall in their favor. So now, the dealerships are pushing for a new bill that would prevent Tesla from opening more locations. 
“The bill would shut down our ability to grow in the Ohio market and, frankly, it’s just a first step to them shutting down our existing businesses,” said Tesla Vice President Diarmuid O’Connell. “This is the pattern we see in other states."

[SOURCE: The Car Connection]

According to auto dealers, they are necessary middlemen between auto manufacturers and consumers. They've insisted that their role provides fair play for consumers when it comes to warranties and service issues. 
Tesla feels differently. Tesla CEO Elon Musk said that auto dealerships don't do a very good job at selling specialty cars like Tesla's high-end electric vehicles (Roadster, Model S). Hence, he's looking to run his own Tesla stores around the U.S. where he believes his cars will get a fair shot at being sold.  
The problem is that auto dealers don't want to sell Tesla vehicles, and they're also barring Tesla from selling its own vehicles (with the exception of online, where customers can physically touch or test drive the EVs). 
It recently came to light that Ohio Sen. Tom Patton (R-Strongsville) backed the bill -- called Senate Bill 260 -- which aims to prevent Tesla and any other automaker from "applying for a license to sell or lease new or used motor vehicles at retail." What's interesting is that Patton received at least $42,825 between 2002 and 2013 from state and national auto dealership owners, employees, and political action committees. 
Auto dealers spent $86.8 million on state election races across the U.S. between 2003 and 2012. They also spent $53.7 million on federal campaigns. Tesla, on the other hand, has spent less than $500,000 on both state and federal politics.  
The deep pockets of auto dealers is what Tesla believes is the cause for the recent direct sales ban in New Jersey. Earlier this month, New Jersey Gov. Chris Christie’s administration proposed the new rule, which requires a person to have a franchise agreement with an auto manufacturer in order to be granted a license to sell. 
Then, last week, the New Jersey Motor Vehicle Commission voted in favor of the ban of direct auto sales. Tesla already operates two stores in New Jersey, and had plans to open more before this new rule.  
Musk wrote his frustrations in a blog post titled, "To the People of New Jersey" on the Tesla Motors website. Musk said Christie's "protection" of consumers is similar to that of the mafia, and even brought up the Bridgegate scandal.  

Source: The Detroit News

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Businesses fear competition!!!
By amanojaku on 3/19/2014 2:53:43 PM , Rating: 5
Who would have guessed?

Imagine the uproar if farmers' markets were banned in order to support food dealers, er, supermarkets. It should be illegal to require a middleman if the middleman offers no additional necessary value over direct sales.

RE: Businesses fear competition!!!
By Reclaimer77 on 3/19/2014 3:01:17 PM , Rating: 2
I don't see how this bill could stand on legal grounds. Tesla already has two locations in-state. How are they going to tell a company, legally, that they cannot expand their business beyond two locations?

This is far more hostile and overt than other States, where they can hide behind the "it's the law, gotta have dealership" mantra. They're ALREADY allowed Tesla stores here. Here they are actively trying to kill a company's business expansion. Can they even do that?

Regardless of how people may think I feel about Tesla or EV's, I cannot stand behind this...this thuggery.

RE: Businesses fear competition!!!
By TSS on 3/20/2014 11:35:29 AM , Rating: 1

You do know that the government *is* the law right? If they pass a law saying murder is legal.... murder would become legal.

Not legal = reprecussions for performing said action. No reprecussions = legal. If the government performs an action without reprecussion = legal for the government to perform that action.

The US war for independance = england saying whatever the hell it was doing was legal and the US citizens begging to differ. If england then says shooting the people who protest is legal and the choice becomes die or fight back... well.. then it's a war.

By GotThumbs on 3/24/2014 12:49:05 PM , Rating: 2
No need to pass a law.

Our current "Leader" ignores many of our current laws as he sees fit.

It's only if a law is it then an issue.

RE: Businesses fear competition!!!
By tng on 3/19/2014 3:11:24 PM , Rating: 2
But auto dealers believe that Tesla's direct sales model could branch out to many more locations, and eventually, other auto manufacturers could even follow suit.
Not likely in the near future IMO.

Like you said this is just a bid to stall the competition. Even if this is successful, eventually Tesla will find a way to sell in the state and they will have to pay people off to pass more laws.

RE: Businesses fear competition!!!
By TheDoc9 on 3/19/2014 3:59:26 PM , Rating: 4
I hope Tesla is successful. The standard car dealership model needs to stop as it relies on lies and deception.

Car dealerships feel perfectly justified using every psychological trick. Maybe it's the worker who looks to be inspecting inventory and strikes up a conversation, casually mentioning the warranty since 'these new cars have so many computers'.

Or maybe your sales person tells you how they plan to get the tint when they purchase their own car, since it's the best IR tint.

It goes on and on...All of this manipulation even before you start talking price! Give me direct sales please!

RE: Businesses fear competition!!!
By marvdmartian on 3/20/2014 7:32:26 AM , Rating: 3
Yeah, having recently purchased a new Jeep Wrangler, I got a kick out of their sales tactic. I told them exactly the model options I wanted, and told them if they could get me the right price, we'd talk.
About a half dozen times, as the salesman is working on his car deal scratch sheet, he says, "If we can do this for you today, will you be willing to buy today? If so, initial here," and he'd draw a line, I'd initial it, he'd scurry off to talk to the sales manager, and come back after a minute or two.
Geez, guys, I gave you the parameters for the sale. Stop spending the extra hour of dramatic selling points with me, and let's get the paperwork drawn up already!

RE: Businesses fear competition!!!
By TheDoc9 on 3/20/2014 10:41:15 AM , Rating: 1
Honestly I think they just go back there and shoot the shit with the manager. I can hear them now 'I got one on the line boss.... did you see dancing with the stars last night'...

RE: Businesses fear competition!!!
By Sazabi19 on 3/20/2014 11:36:25 AM , Rating: 2
Exactly on this. I just got me a new car as well. There is a dealer closer to my house for Kia and I went there. I shop for cars for many months before I go get one so I do research. I told the dealer I knew what I wanted and to not mess with me with dealer tricks. He was a pretty straight shooting guy but the management was horrible. The last time I went in there (3rd time) I was looking at a new model (Cadenza) instead of the original I went in for because it was nicer and had a better lease price. After being in there for a few hours I was told that they didn't have the prices right and another manager was going to get a talking to for the prices being incorrect. I showed them on Kia's site where it had the lease cost and he just looked at me blankly. I told them their numbers weren't right and left. The next day the dealer called and said they had a hiccup in the system and that the price was what I was wanting, but now I wanted nothing to do with this dealer. I went to another Kia dealer (several times farther from my house than the original) and told the new dealer that I left the other dealer because they tried to screw with me. All he had to do was be truthful and work with me and if the price was right I would sign. As soon as I walked over I found the exact car I wanted (colors inside and out as well as package) that the other dealer said there were none in the state (it had been there a few weeks at least). They did their usual try to squeeze the price down and introduced me to the finance guy who was trying to "work" my deal, whatever I hate that. Ultimately they go the idea if they didn't lower it I would walk so they got it where I wanted and I bought it. The other dealer called back asking when I would be back in and I told them never, I bought from a competent dealer. I wish I didn't have to deal with any dealer, they are all just sales men trying to get the most out of you in any way they can. They are some of the worst sleaziest people to roam the earth.

RE: Businesses fear competition!!!
By ritualm on 3/20/2014 2:20:27 PM , Rating: 2
Amongst other sleazy tactics, the salespeople made me do only right-turns during a test drive of a Corolla, as if they're scared I'm going to wreck their demo cars. My preliminary driving exams were more involved than that "trip".

Luckily, I picked a color that turned out to be unavailable at that dealership, and walked away from an almost certain purchase agreement.

By marvdmartian on 3/24/2014 8:17:54 AM , Rating: 2
Another good idea, if you're wanting a good test drive, and can't find a dealer who will let you borrow the car for 24 hours, is to check around at the car rental places, and see if any of them carry that model.

I have done that, a couple times in the past, and found it much more educational (albeit, a bit more expensive) than the dealership's 10-minute test drive.

RE: Businesses fear competition!!!
By kingmotley on 3/19/2014 5:26:18 PM , Rating: 2
I have no use for car dealerships for sales of new vehicles. My last car I walked into, I handed them a list of the option codes I wanted, and they typed it into a computer. For that luxury of not typing it in myself, I paid the dealership approximately $7,000-$9,000.

By kingmotley on 3/19/2014 5:28:32 PM , Rating: 2
Also note, they had none in stock, so I had never seen one in person, nor had I driven one, so the dealership model did absolutely nothing for me at all.

RE: Businesses fear competition!!!
By mdogs444 on 3/20/2014 8:11:32 AM , Rating: 2
Tell that to the Automotive Dealership lobby....

RE: Businesses fear competition!!!
By mars2k on 3/20/2014 8:29:21 AM , Rating: 2
Republicans are such hypocrites. They want free trade and no regulations until their cronies’ ox get gored. What’s all this garbage they spew about a “Nanny State” when it comes to benefits for the poor? Apparently it’s the business community that needs the nannies. This is trade restraint if ever there was restraint. Again legislatures conspire with business interests who feel as though they have some proprietary interest in the consumer. LET THE MARKET DECIDE!!!

By GotThumbs on 3/24/2014 1:05:35 PM , Rating: 2
Dont' be so quick to judge this as strictly a party affiliation issue.

I'm all for Tesla's direct selling and could care less about the Dealerships.

You need to look closers at the details to see it's NOT 100% regulated to just one party.

While I'm not happy with the ratio, its not 100%.

"If they're going to pirate somebody, we want it to be us rather than somebody else." -- Microsoft Business Group President Jeff Raikes

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