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Why do there need to be laws specific to that? Aren't companies like Tesla capable of deciding if they need more or less service centers, in what locations and
by pmorici 13y ago
Why do there need to be laws specific to that? Aren't companies like Tesla capable of deciding if they need more or less service centers, in what locations and what model is best to run them?
- chaz 13y agoSorry if I wasn't clear: there are laws that currently exist that protect franchises in almost every state. I'd love to see those laws eliminated or changed to encourage more competition between dealers to improve pricing and service. Companies like Tesla should absolutely be able to do what they'd like without having local protectionism kick into place. There's a great story from NPR Planet Money that covers this: http://www.npr.org/blogs/money/2013/02/12/171814201/episode-435-why-buying-a-car-is-so-awful http://www.npr.org/blogs/money/2013/02/12/171814201/episode-.... It's been a while since I've listened to it, but the tl;dr is that franchises are granted exclusivity to a geography, and manufacturers can't change the franchise terms without going to a review board that's basically controlled by the dealers. So if Chevrolet has a poorly-performing dealer, they can't threaten to take the franchise away, or can't put another dealerships in the same geography. (ugh, replied to the wrong thread, moved the reply, and this is dead ... sorry)
- mc-lovin 13y agoUnfortunately the argument that in a free market, what maximizes profit is socially optimal, is not taught in schools, and alien to many people. It doesn't help that in public debate, this argument is usually espoused by people on the right who mix it in with other unrelated arguments. So people end up thinking that if they support the free market, they also have to support cutting all welfare.