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I'm responding directly to his "large corporate interests" talking point, when those large corporate interests are barred from selling directly.

jbooth 13y ago
The large corporate interests have the infrastructure in place and don't particularly want to sell directly. This regulation serves as a moat to keep out competition.
- bob13579 13y ago
  1) The large corporate interests don't own that infrastructure. The actual owners can choose whoever they want to represent. 2) What's stopping Tesla from partnering with Toyota dealers? 3) With its $10B valuation, Tesla could build 10 very nice dealerships for 1% of its valuation.
  - jbooth 13y ago
    To be clear, this is more about inertia than it is some nefarious cabal erecting barriers to Tesla. But, if the regulation was a big problem for the corporate interests? The regulations would definitely not still be here. When it comes to money and regulations, I like to picture water acting on rock over time -- they get carved away a little bit at a time.
  - runako 13y ago
    IIRC auto manufacturers are prohibited by law from owning dealerships. So Tesla would be introducing a dependency of variable quality between itself and its customers.
  - mhurron 13y ago
    > What's stopping Tesla from partnering with Toyota dealers? My guess is Tesla not wanting to slap a bunch of dealer costs on top of the cost of the cars. > Tesla could build 10 very nice dealerships for 1% of its valuation. As I understand it, Tesla owning those dealerships would be just as illegal. If Tesla doesn't own the dealerships, they're either going to share the profits of the sold cars with the dealership or deal with the dealers markup and dealers fees increasing the costs of the cars.
mikeash 13y ago
The "large corporate interests" being protected in this case are car dealerships, not manufacturers.
- bob13579 13y ago
  At a $10B valuation, Tesla is worth about 1000 times the average car dealership in Texas.
  - mikeash 13y ago
    If true, then given the fact that there are about 20,000 car dealerships is Texas (http://txdmv.gov/dealers-portal/motor-vehicle-dealers http://txdmv.gov/dealers-portal/motor-vehicle-dealers), that means the dealerships outweigh Tesla by a factor of 20. And that's not even counting the fact that these are all dealers in Texas, whereas Tesla's presence applies to the entire country. If we assume Texas is about 1/10th of the US, that means the local dealers outmatch them by a factor of about 200.

jbooth 13y ago

The large corporate interests have the infrastructure in place and don't particularly want to sell directly. This regulation serves as a moat to keep out competition.

bob13579 13y ago
1) The large corporate interests don't own that infrastructure. The actual owners can choose whoever they want to represent. 2) What's stopping Tesla from partnering with Toyota dealers? 3) With its $10B valuation, Tesla could build 10 very nice dealerships for 1% of its valuation.
- jbooth 13y ago
  To be clear, this is more about inertia than it is some nefarious cabal erecting barriers to Tesla. But, if the regulation was a big problem for the corporate interests? The regulations would definitely not still be here. When it comes to money and regulations, I like to picture water acting on rock over time -- they get carved away a little bit at a time.
- runako 13y ago
  IIRC auto manufacturers are prohibited by law from owning dealerships. So Tesla would be introducing a dependency of variable quality between itself and its customers.
- mhurron 13y ago
  > What's stopping Tesla from partnering with Toyota dealers? My guess is Tesla not wanting to slap a bunch of dealer costs on top of the cost of the cars. > Tesla could build 10 very nice dealerships for 1% of its valuation. As I understand it, Tesla owning those dealerships would be just as illegal. If Tesla doesn't own the dealerships, they're either going to share the profits of the sold cars with the dealership or deal with the dealers markup and dealers fees increasing the costs of the cars.

mikeash 13y ago

The "large corporate interests" being protected in this case are car dealerships, not manufacturers.

bob13579 13y ago
At a $10B valuation, Tesla is worth about 1000 times the average car dealership in Texas.
- mikeash 13y ago
  If true, then given the fact that there are about 20,000 car dealerships is Texas (http://txdmv.gov/dealers-portal/motor-vehicle-dealers http://txdmv.gov/dealers-portal/motor-vehicle-dealers), that means the dealerships outweigh Tesla by a factor of 20. And that's not even counting the fact that these are all dealers in Texas, whereas Tesla's presence applies to the entire country. If we assume Texas is about 1/10th of the US, that means the local dealers outmatch them by a factor of about 200.