When I went to see the Model S Beta at Larz Anderson museum here, I was told that the store would open in late Spring. Now, I know the reason for the delay.
I support unions and union rights, and I hope this gets cleared soon.
As I see it, this has little to do with unions or unions rights. It has to do with a new automobile sales paradigm in which all cars are custom-ordered and few, if any, cars are purchased "off the lot."
TM represents a threat to conventional auto dealers (hence the legal action), because if the company and its sales paradigm are successful, the major automakers might move to adopt the same approach over time. And that really threatens the existing order.
@Soflauthor, you are right about the reason why the dealers are resisting against Tesla showroom.
There are other car companies (especially MB and BMW) that allow you to customize your car and take delivery. But, in even these cases, you still have to pick 'em up at a local dealership. I guess that part is different between Tesla and the other auto manufacturers.
Are there any other companies, even the very high end ones, that allow you to purchase a car "off-the-lot"?
I doubt that other major manufacturers would want to adopt this approach, even if it turns convenient for Tesla. The sheer numbers of dealers is just huge for other car companies to takeover, especially at a time when they are trying to stick to the core of their business.
I think it's a little bit of two things:
1) The dealership association protecting their members who had to invested millions in their traditional dealerships in order to comply with the law. Their argument that Tesla should have do the same is not unreasonable, whether you agree with it or not... don't beat me up :)
2) The state protecting consumers from here today, gone tomorrow operators. When your only capital investment is a storefront lease in an upscale shopping center, you don't lose much if you pick up and go, leaving those who bought your car without support. I'm not suggesting that Tesla would ever do that, but I think the legislative intent was to protect the consumer.
I hate that Tesla has this issue but it is their state law and they must adhere to it. What it has to do with unions? I have no idea.
I am still curious about this whole separation of dealer and manufacture thing. At some point is someone going to challenge the on-line order side of Tesla. Will at some point residents of Mass not be able to order a Tesla on-line because there is no repair facility near by?
A store front that does not sell a vehicle but just lets you look at it is not a dealership. It's a factory advertising store. If you then have to go online and order it (even if they provide the computers) I think you can argue that Tesla is not setting up dealerships. There are not going to be hundreds of cars parked on the lot. People can come in look at the car and Tech then go home and order.... where do you draw the line. I am guessing the actual law spells that out.
I am guessing they have the same law for boats and RVs since the law is there to, "protect the customer".
It doesn't have anything to do with unions. The author made an unfortunate choice of words when he referred to business unions. Those were owner trade associations (e.g. National Widget Producers Association), not labor unions, (e.g United Brotherhood of Widget Workers).
Wouldn't the placement of a service center in Boston solve the problem (if there isn't already one there)?
it's just another desperate attempt to bash Tesla ... not to stop them (that's to late), but maybe to slow them down at some points!
The big auto industry is years behind and they are the big chunks.. I mean, they got the most expensive advisors and that's way, it goes. I'm very smooth with it, because Elons team will have the right arguments!
Legally I think Tesla can work around the issue. If all sales transpire over the Internet (that seems to be their goal) then the stores are nothing more than show rooms. Deliveries can be made through the service centers which don't fall under those laws.
Since the employees don't work for a commission, the stores become nothing more than information centers where potential customers can come and look, touch, drive the product before going home and placing an order on line.
Worse case scenario, Robert.Boston and many others have to take deliver of their "S" in an adjacent state until matters resolve. Sad...but true.
I think Klaus is right. Tesla encountered a similar situation in Texas. I think it reall is difficult for the dealers to understand Tesla's business plan. No dealers. No sales people. Just information/show rooms and people knowlegable about the technology and the product. Order online. Deliveries to your home. Simple. But disruptive!
Ah hah. Here's a scam. Tesla only sells cars over the internet. Contracts service to a third-party. Now I wouldn't have to pay sales tax on my new Tesla unless I live in California. :)
I suspect that when you register your car for your plate, the fee will include sales tax unless you can show that you paid tax in another jurisdiction.
Large purchases (as in size) tend to leave a paper trail. I purchased a wine cabinet some years ago over the internet and had it delivered to my home. Apparently the shipping company had to file something in regards to interstate transportation and I got a nice notice in the mail explaing that I owed Florida sales tax on the purchase.
I suspect a car would likely create the same notice even if you could somehow avoid it during registration. Also Tesla told me that all local/state fees and taxes are included (and taken care of)in the MVPA.
Texas has the same kind of law as well. Not only are you allowed to buy directly from the manufacturer the manufacturer cannot directly service the vehicle. Texas is a nonunion right to work state and we still have the same type of laws. I think the auto dealers have quite a lobby in Austin to have gotten something like that passed here. It is supposedly to protect us helpless customers from the giant greedy car companies. Unfortunately all it does here is add a greedy middle man and commissioned salesmen with their hands out for their cut of the action.
Tesla wants to keep their image and customer service in house so that everyone gets the same experience. I have some very bad opinions of some automakers solely based on the treatment and service I received at a dealership which is not under control of the automaker but only under the control of family owned local businesses and their unconcerned employees.
They still have yet to workout the way the sales process and service will work in Texas. The store open in the Houston Galleria is not able to sell any product and is only allowed to explain the benefits of BEV automobiles. They cannot even offer test drives.
The idea that we have to purchase our cars in another state is not too comforting. I am guessing that Tesla might have a way to workaround as they are aware of these criteria for a while.
Setting up a showroom where with 'technically' no sales sounds like exploiting a loophole. As much as I love and support Tesla, I think it is important, at least in a bigger picture, that there are no loopholes for companies can exploit. Using loopholes, in my opinion, is not a completely ethical way of doing business. I'd rather purchase my Model S in New York than support a transaction that takes advantage of a loophole.
In either case, I wonder how the service center will operate.
@cerjor, as jackhub says, you need to pay sales tax for all purchases, including online purchases. Unlike traditional stores that require you to pay sales tax at the time of purchase, online stores (especially those that do not have a presence in your state) don't collect sales tax at the time of purchase. Instead, they leave the burden to you; you need to report these purchases and pay the state sales tax when you file your state tax returns. And, of course, a whole lot of us do not do this.
Chicago has their original store/service center, heck it was still under construction when we went down and drove the Roadster(Super Awesome), then their store in Oak Brook where we went through. Follow that example.
prash, I bellieve you will order your Tesla online no matter which Tesla store you visit. New York, Santana, wherever. The stores do not take orders. They are there to show off and explain the technology. If you like, while there, you can use the store's 'design studio' to order your car . . . online. It is essentially the same design studio we have access to from home. The regulators and the dealer networks have difficulty understanding this new business model. Tesla has designed a new type of car, a new kind of factory, and a new way of selling cars.
prash you are baffling.
"The idea that we have to purchase our cars in another state is not too comforting. I am guessing that Tesla might have a way to workaround...."
They have a workaround but, "Setting up a showroom where with 'technically' no sales sounds like exploiting a loophole."
You consider it a loophole.
If there is a car show in your state and 10 people order a car right there using their tablets or Iphones are they also exploiting a loophole? Does the convention center hosting the event now have to install a service center for all the manufactures that have cars on display?
@Sudre_, a convention center or a car show is not permanent and the store in Natick is. I guess, there are some differences among them. And I still think that the Natick store will be pretending to be something it is not ... like the 'We sell your stuff on ebay' store in 40-year old virgin movie :)
I realize that 'I' have to order to the car online. But, I am under the impression that this is because I reserved the car ahead of its release. And hence, the online ordering.
Do you think this will be the case in the future as well ... for all the vehicles, even those that do not need a reservation? Sooner or later, when all the Tesla enthusiasts run out, wouldn't there be a need for a conventional car dealership where customers can try and purchase a car? I am not too convinced that this is how it will be for the long term.
These laws are not designed to protect consumers, they are to protect existing car dealers from competition. How, on earth, does selling used cars swell protect consumers? Seems to me all it does is make it cost more to start up a dealership.
Regardless, I think that Klaus is correct (or at least I would argue he is) in that the Tesla showroom doesn't sell the cars; Tesla Motors does. Frankly, all storefront does is serve as an informational front and so the basic business permits should be adequate.