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If states allowed direct sales, an entire industry would vanish overnight. Auto dealerships employ two million people in the US. No politician wants that on the

by koboll 8y ago

If states allowed direct sales, an entire industry would vanish overnight. Auto dealerships employ two million people in the US. No politician wants that on their hands.

madengr 8y ago
I don’t care. It’s sort of like wiping out a virus with a vaccine. If everyone in the pay day loan industry loses their job, who cares. Car dealers are at the same level.
mgkimsal 8y ago
yet... i would think a sizeable portion of them would just be shuffled and reemployed someplace else in the auto chain. maybe not 100% but... most?
- xeromal 8y ago
  Are you willing to stake your career on that guess?
lotsofpulp 8y ago
There's lots of infrastructure work to be done if politicians were concerned about employment numbers.
brandmeyer 8y ago
I'm not so sure. Cars need maintenance. Customers want to drive the cars before they buy them. So maybe the management and dealership owners lose out, but the rank and file should still come out OK. I think the same thing may be true with tech employers and their on-site benefits. Sure, the employees aren't eating out in town as much, but they are still eating. For the line cooks and other service workers, there's still work to be had. Its the people who are in the business of owning service industry businesses that are in trouble.
- PhantomGremlin 8y ago
  Cars need maintenance. How much maintenance do electric vehicles (not hybrids) need? Probably less than 25% of that of IC vehicles. Oops. There goes 75% of the service department. Which is probably a higher margin area than sales. They mark up the parts and then bill $150 per hour for labor and probably pay mechanics less than 25% of that rate. If I owned a new car dealership I'd sell it within the next 5 years. Because EVs are coming.
  - TeMPOraL 8y ago
    > How much maintenance do electric vehicles (not hybrids) need? Probably less than 25% of that of IC vehicles. If built to be good cars, not profitable cars. The cynic in me says that manufacturers will find some ways to raise the maintenance requirements of EV to maximum level they can still get away with. Such is the way markets work.
    - PhantomGremlin 8y ago
      Sigh. I think you're spot on with your cynicism. But maybe the market won't let them get away with it, if there's sufficient competition? Here's my sad story of what you allude to, regarding a washing machine (or maybe it was a dryer I forget now): An electric motor is fundamentally an incredibly reliable part. I'd venture that there are still some 100-year-old electric motors in daily service. The "contactor" (fancy word for a high power relay) failed. This contactor controlled the electric motor which made the drum turn. Turns out that the field replaceable unit is not the contactor, but is an assembly that combines the motor and contactor. So instead of being able to replace just the relay (which can be prone to failure after some years of use), the entire assembly must be replaced. A perfectly good motor thrown away because the contacts on the relay controlling it went bad. The replaceable unit cost $320 (this was a while ago) instead of perhaps $20 for the relay itself!
mysterypie 8y ago
Interesting, I didn't realize there were laws against direct sales[1]. The phenomenon of bullshit jobs--i.e., jobs that serve no real purpose--has been discussed here on HN multiple times[2]. It's funny how entire industries (like the 2-3 million people who do health care paperwork in the U.S.) could disappear overnight if the systems and regulations were different, and we wouldn't notice, except possibly for the unemployment it would create. [1] "U.S. car dealerships [are] protected by state laws. Most state laws expressly prohibit manufacturers and distributors from operating retail outlets. They must by law sell their vehicles through independent franchise retail distribution network." https://www.theglobeandmail.com/globe-drive/culture/commuting/why-cant-we-buy-cars-directly-from-car-companies/article16935030/ https://www.theglobeandmail.com/globe-drive/culture/commutin... [2] Most recently: https://news.ycombinator.com/item?id=17260911 https://news.ycombinator.com/item?id=17260911
- blattimwind 8y ago
  > I didn't realize there were laws against direct sales Interesting. Not even Germany has such a law, I wonder whether that makes the US a car maker or rather a car seller country?
  - TeMPOraL 8y ago
    I recall reading that laws against direct sales were created because car makers in the US were very abusive/anticompetitive. So the laws might have had some sense at that time.
exabrial 8y ago
That sounds AWESOME
closeparen 8y ago
Don't the direct-sales showrooms also need staff?

by koboll 8y ago

If states allowed direct sales, an entire industry would vanish overnight. Auto dealerships employ two million people in the US. No politician wants that on their hands.

madengr 8y ago

I don’t care. It’s sort of like wiping out a virus with a vaccine. If everyone in the pay day loan industry loses their job, who cares. Car dealers are at the same level.

mgkimsal 8y ago

yet... i would think a sizeable portion of them would just be shuffled and reemployed someplace else in the auto chain. maybe not 100% but... most?

xeromal 8y ago
Are you willing to stake your career on that guess?

lotsofpulp 8y ago

There's lots of infrastructure work to be done if politicians were concerned about employment numbers.

brandmeyer 8y ago

I'm not so sure. Cars need maintenance. Customers want to drive the cars before they buy them. So maybe the management and dealership owners lose out, but the rank and file should still come out OK. I think the same thing may be true with tech employers and their on-site benefits. Sure, the employees aren't eating out in town as much, but they are still eating. For the line cooks and other service workers, there's still work to be had. Its the people who are in the business of owning service industry businesses that are in trouble.

PhantomGremlin 8y ago
Cars need maintenance. How much maintenance do electric vehicles (not hybrids) need? Probably less than 25% of that of IC vehicles. Oops. There goes 75% of the service department. Which is probably a higher margin area than sales. They mark up the parts and then bill $150 per hour for labor and probably pay mechanics less than 25% of that rate. If I owned a new car dealership I'd sell it within the next 5 years. Because EVs are coming.
- TeMPOraL 8y ago
  > How much maintenance do electric vehicles (not hybrids) need? Probably less than 25% of that of IC vehicles. If built to be good cars, not profitable cars. The cynic in me says that manufacturers will find some ways to raise the maintenance requirements of EV to maximum level they can still get away with. Such is the way markets work.
  - PhantomGremlin 8y ago
    Sigh. I think you're spot on with your cynicism. But maybe the market won't let them get away with it, if there's sufficient competition? Here's my sad story of what you allude to, regarding a washing machine (or maybe it was a dryer I forget now): An electric motor is fundamentally an incredibly reliable part. I'd venture that there are still some 100-year-old electric motors in daily service. The "contactor" (fancy word for a high power relay) failed. This contactor controlled the electric motor which made the drum turn. Turns out that the field replaceable unit is not the contactor, but is an assembly that combines the motor and contactor. So instead of being able to replace just the relay (which can be prone to failure after some years of use), the entire assembly must be replaced. A perfectly good motor thrown away because the contacts on the relay controlling it went bad. The replaceable unit cost $320 (this was a while ago) instead of perhaps $20 for the relay itself!

mysterypie 8y ago

Interesting, I didn't realize there were laws against direct sales[1]. The phenomenon of bullshit jobs--i.e., jobs that serve no real purpose--has been discussed here on HN multiple times[2]. It's funny how entire industries (like the 2-3 million people who do health care paperwork in the U.S.) could disappear overnight if the systems and regulations were different, and we wouldn't notice, except possibly for the unemployment it would create. [1] "U.S. car dealerships [are] protected by state laws. Most state laws expressly prohibit manufacturers and distributors from operating retail outlets. They must by law sell their vehicles through independent franchise retail distribution network." https://www.theglobeandmail.com/globe-drive/culture/commuting/why-cant-we-buy-cars-directly-from-car-companies/article16935030/ https://www.theglobeandmail.com/globe-drive/culture/commutin... [2] Most recently: https://news.ycombinator.com/item?id=17260911 https://news.ycombinator.com/item?id=17260911

blattimwind 8y ago
> I didn't realize there were laws against direct sales Interesting. Not even Germany has such a law, I wonder whether that makes the US a car maker or rather a car seller country?
- TeMPOraL 8y ago
  I recall reading that laws against direct sales were created because car makers in the US were very abusive/anticompetitive. So the laws might have had some sense at that time.

exabrial 8y ago

That sounds AWESOME

closeparen 8y ago

Don't the direct-sales showrooms also need staff?