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I personally find it absurd that there are such laws protecting car dealerships, but then again given the history of the industry, there does need to be some re
by programminggeek 13y ago
I personally find it absurd that there are such laws protecting car dealerships, but then again given the history of the industry, there does need to be some regulation. Where it seems to go wrong is the idea that a company couldn't sell their product direct to consumer. It's sort of like saying that Apple stores can't exist and Apple has to sell everything via Best Buy, Target, and Wal-Mart. Somehow, it seems that is how the car dealership racket has been legislated.
There is probably some kind of middle ground where Tesla should be able to sell direct, while there should probably be a possibility of dealerships trying to cut a deal with Tesla.
The real quagmire of unintended consequences here seems to be in how trading 6500 factory jobs for however many thousand dealership jobs. I don't know how it shakes out on either the jobs or tax income end for Texas, but whenever you are talking large change like this, the unintended consequences are usually worse than predicted in one direction or another.
- Steko 13y agoIs it not possible for Tesla to somehow create a non-profit(?) they have no stake in that just goes around these states setting up Tesla friendly dealerships that basically mimic Tesla's own showrooms?
- joelrunyon 13y agoI'm sure 6-12 months down the road - there'd be a scathing expose about how Tesla is abusing a non-profit status to steal business from legitimate neighborhood dealerships.
- protomyth 13y agoA lot of industries have had "protect the middleman" laws, so it's not really a car only thing. Gov. Perry sees the way the wind is blowing and probably believes (at least from the last couple of interviews) that the model will change so he might as well get the factories. The auto folks will still have some local people.
- rogerbinns 13y agoThis corruption is known as regulatory capture. https://en.wikipedia.org/wiki/Regulatory_capture https://en.wikipedia.org/wiki/Regulatory_capture > Regulatory capture is a form of political corruption that occurs when a regulatory agency, created to act in the public interest, instead advances the commercial or special concerns of interest groups that dominate the industry or sector it is charged with regulating. Regulatory capture is a form of government failure; it creates an opening for firms to behave in ways injurious to the public (e.g., producing negative externalities). The agencies are called "captured agencies".
- nhebb 13y agoManufacturing is different than other industries in that it's recognized to have a large multiplier effect. Historically, the estimate has been that for every manufacturing job created, 1.5 - 4 other jobs are created in the surrounding area, so it's really a lot more than 6500 jobs at stake. Rockwell Automation published a study a few years ago claiming that it might be as high as 16x in some cases. They have an inherent bias since they sell equipment to other manufacturing companies, but they made some interesting arguments. Their paper can read here: https://www.rockwellautomation.com/resources/downloads/rockwellautomation/pdf/about-us/company-overview/Multiplier_Effect.pdf https://www.rockwellautomation.com/resources/downloads/rockw...
- malandrew 13y ago"The real quagmire of unintended consequences here seems to be in how trading 6500 factory jobs for however many thousand dealership jobs." Tesla going direct to consumer in most states is really only a matter of time. Assuming this is true, that eventually dealers are going to go the way of the dodo. And if that is the case, wouldn't if be best to bet on 6500 jobs that are likely to stick around in the future and keep bringing in revenue for the state, than let another state get that factory and one day you have neither the dealership jobs or the factory jobs in your state. Plus, it's not like those dealership jobs are going to disappear overnight.