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> Negotiate with the manufacturers to handle direct-to-consumer sales for them. As in, found a startup and then negotiate with Ford, GM, Toyota, Volkswagen etc

> Negotiate with the manufacturers to handle direct-to-consumer sales for them. As in, found a startup and then negotiate with Ford, GM, Toyota, Volkswagen etc about a deal that's guaranteed to piss off the existing dealer networks that make ~100% of their revenue and will view this as an existential threat? Good luck with that! Above all, this seems to assume car companies are stupid. Ford, GM & co would sell their grandmothers to get an extra 6% margin on their cars, the reason they're not selling directly already (in the US) because they figure it's not worth the risk -- and if they do decide to try, they're certainly not going to give the opportunity to a random startup trying to form a new monopsony that would leave them even worse off than before.

jasonkester 11y ago
Thus the billions of dollars of VC and fighting mentioned above. In the context of what you've written, though, can you explain why Tesla chooses to sell directly to consumers? They have the ability to sell through dealers, just like the established automakers. And it would cost them a lot less money and hassle to do so. Why then would they choose to sell direct if not that it actually made good business sense to do so.
- jeromeflipo 11y ago
  > They have the ability to sell through dealers, just like the established automakers. And it would cost them a lot less money and hassle to do so. Not in a world dominated by fossil fuels. This is worth a read: http://www.teslamotors.com/blog/tesla-approach-distributing-and-servicing-cars http://www.teslamotors.com/blog/tesla-approach-distributing-....
- jpatokal 11y ago
  Because Tesla is starting from scratch and doesn't have an established dealership network to worry about disrupting. The PR angle and having full control over the experience also helps (see also: Apple Store). And like Apple -- on second thought, much more so than Apple -- they're a niche producer and can cover a good chunk of their potential customers with only a few stores. For example, here in Australia, they've got two (2) stores for a market of 20+ million, consisting of one each in Sydney and Melbourne, while (eg.) Toyota has 36 dealerships in Melbourne alone.

jasonkester 11y ago

Thus the billions of dollars of VC and fighting mentioned above. In the context of what you've written, though, can you explain why Tesla chooses to sell directly to consumers? They have the ability to sell through dealers, just like the established automakers. And it would cost them a lot less money and hassle to do so. Why then would they choose to sell direct if not that it actually made good business sense to do so.

jeromeflipo 11y ago
> They have the ability to sell through dealers, just like the established automakers. And it would cost them a lot less money and hassle to do so. Not in a world dominated by fossil fuels. This is worth a read: http://www.teslamotors.com/blog/tesla-approach-distributing-and-servicing-cars http://www.teslamotors.com/blog/tesla-approach-distributing-....
jpatokal 11y ago
Because Tesla is starting from scratch and doesn't have an established dealership network to worry about disrupting. The PR angle and having full control over the experience also helps (see also: Apple Store). And like Apple -- on second thought, much more so than Apple -- they're a niche producer and can cover a good chunk of their potential customers with only a few stores. For example, here in Australia, they've got two (2) stores for a market of 20+ million, consisting of one each in Sydney and Melbourne, while (eg.) Toyota has 36 dealerships in Melbourne alone.