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Back in the day, a vehicle was a pretty big purchase so you wanted to know that you could get service & maintenance throughout the life of the vehicle. If the d

Back in the day, a vehicle was a pretty big purchase so you wanted to know that you could get service & maintenance throughout the life of the vehicle. If the dealership is nothing more than a front for the manufacturer then they might move the store if business is slow, etc. Forcing the use of franchised stores meant that the dealerships are owned (always?) by local people so they can't just move away. Now days other laws pretty much make this a non-issue although you could argue that the repair/service process for Tesla's is exactly what these laws were intended to prevent; who would want to own a Tesla dealership if you can't get the parts to fix your customers's cars? e.g. Your son's basketball coach is going to keep calling until you get his car fixed. In your example, you would be restricted to buying from Greg's Phone Emporium because Greg is thought to care more about repairing your phone than Apple. Edit: The biggest issue with the current dealership system is that it, of course, just evolved into rent seeking and over-complicated purchase process. The auto companies have systems to make sure dealers sell cars no matter what and the dealerships have ways of extracting extra profit from their customers.

mjevans 5y ago
The local franchise doesn't cover you either. They get resold and can even close down if an area just isn't profitable. I have seen this happen within my lifetime but don't want to provide a citation as the situation might still be rare and thus could dox myself.
908B64B197 5y ago
> Forcing the use of franchised stores meant that the dealerships are owned (always?) by local people so they can't just move away. Just like foreign countries levying fines on "evil foreign tech companies", it was an older attempt at rent seeking from the "foreign" faraway auto manufacturers.
xyzzyz 5y ago
> Forcing the use of franchised stores meant that the dealerships are owned (always?) by local people so they can't just move away. Local people close down their local businesses all the time, though. In fact, the manufacturer, because of vertical integration, is more likely to make profit than independent dealer, and so less likely to close down.
asdff 5y ago
The reason why direct sales are illegal has nothing to do with that, it's because dealerships lobbied for a law that would preserve their industry and got it.

mjevans 5y ago

The local franchise doesn't cover you either. They get resold and can even close down if an area just isn't profitable. I have seen this happen within my lifetime but don't want to provide a citation as the situation might still be rare and thus could dox myself.

908B64B197 5y ago

> Forcing the use of franchised stores meant that the dealerships are owned (always?) by local people so they can't just move away. Just like foreign countries levying fines on "evil foreign tech companies", it was an older attempt at rent seeking from the "foreign" faraway auto manufacturers.

xyzzyz 5y ago

> Forcing the use of franchised stores meant that the dealerships are owned (always?) by local people so they can't just move away. Local people close down their local businesses all the time, though. In fact, the manufacturer, because of vertical integration, is more likely to make profit than independent dealer, and so less likely to close down.

asdff 5y ago

The reason why direct sales are illegal has nothing to do with that, it's because dealerships lobbied for a law that would preserve their industry and got it.