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> And why is Tesla so against dealers? I'm not a representative of Tesla, but if I was Elon Musk I wouldn't want my product being sold by dealerships either. T

> And why is Tesla so against dealers? I'm not a representative of Tesla, but if I was Elon Musk I wouldn't want my product being sold by dealerships either. The dealership industry is an outdated, parasitic system that has nothing to offer Tesla. It is little more than a middleman which saps away profit that could be going to Tesla itself. On the other hand Tesla has everything to gain in revenue, image, brand value, and consumer experience by running their own boutique stores. The dealerships have also gone way too far trying to get legislation passed to stop Tesla and protect their parasitic business model rather than adding any real value that makes them useful to Tesla. That in my opinion turns this into something more personal, a battle in which Tesla wins more respect the more they fight back. By refusing to sell the vehicle entirely they actually gain in status (the more difficult to obtain good gains value) and they progress toward the longer term goal of making profit free of parasitic middlemen. The alternative would be to make a few more dollars in the short term by using dealerships but lose in the long term. The Elon Musk suite of companies has always been very long term focused so I'm not surprised to see them working toward long term vision rather than giving in on a short term battle. Basically to Tesla the future is selling their goods (not only cars but also Powerwalls, and whatever else they have in development) directly to customers in order to improve profit margin, and they aren't going to give in on the road to making that happen. A boutique store for selling vehicles today can sell Powerwalls the next year. This makes Tesla much more robust instead of being reliant on a middleman.

nordsieck 11y ago
> The dealership industry is an outdated, parasitic system that has nothing to offer Tesla. It is little more than a middleman which saps away profit that could be going to Tesla itself. Ordinarily, middlemen are great. Small farmers can get away with selling at Farmer's markets, but Supermarkets drive an enormous volume of sales. Likewise, Walmart, Target, Fred Meyer's, etc. are all generally pretty good to their suppliers and customers. The big difference when it comes to cars it that customers actively hate car dealerships. I don't know of a single person who is even ambivalent towards the process of buying a car. If Tesla could take that part of the car buying process and make it great, it would be an enormous competitive advantage. Dealerships and the other car manufacturers know this and are terrified that it might work.
- NathanKP 11y ago
  All true. However the interesting dimension for Tesla is that they also sell more than just cars now. They would probably have a hard time getting a car dealership to sell a Powerwall, but with their own Tesla branded store they can sell you "the future" with a car + powerwall combo for example. From that perspective they really have no reason at all to cooperate with dealerships. The car dealerships are too narrowly focused, whereas Tesla is transitioning into more than just a car company, and selling more than just cars.
  - toomuchtodo 11y ago
    "What's that? I can order my Model S, my PowerWalls, and my solar installation from you? gets out checkbook"
- irl_zebra 11y ago
  Dealerships are an outdated relic from a bygone era, like the Electoral College. It's not just about "people hat[ing] car dealerships," the issue is that the dealerships are rent-seeking middlemen between the supplier and the customer. Tesla did take that process and make it great: They opened showrooms and you just order online at a specified price. Easy! Not the same as dealerships though.
- manicdee 11y ago
  I'm not sure what stone you've been hiding under for the last couple of decades, but supermarkets are nobody's friend. As a supplier, supermarkets impose constraints such as, "your apples must be exactly this size and colour, with no blemishes, and cost 5% less than you charges for them last year. If you fail to deliver the 2T per month that we require, you pay us penalty fees. If we don't sell your apples, you pay for disposal. If we have a special on apples, you'll pay us the difference in price. If you sell your apples anywhere else than our supermarket, we charge you penalties." No, middlemen are not great.

nordsieck 11y ago

> The dealership industry is an outdated, parasitic system that has nothing to offer Tesla. It is little more than a middleman which saps away profit that could be going to Tesla itself. Ordinarily, middlemen are great. Small farmers can get away with selling at Farmer's markets, but Supermarkets drive an enormous volume of sales. Likewise, Walmart, Target, Fred Meyer's, etc. are all generally pretty good to their suppliers and customers. The big difference when it comes to cars it that customers actively hate car dealerships. I don't know of a single person who is even ambivalent towards the process of buying a car. If Tesla could take that part of the car buying process and make it great, it would be an enormous competitive advantage. Dealerships and the other car manufacturers know this and are terrified that it might work.

NathanKP 11y ago
All true. However the interesting dimension for Tesla is that they also sell more than just cars now. They would probably have a hard time getting a car dealership to sell a Powerwall, but with their own Tesla branded store they can sell you "the future" with a car + powerwall combo for example. From that perspective they really have no reason at all to cooperate with dealerships. The car dealerships are too narrowly focused, whereas Tesla is transitioning into more than just a car company, and selling more than just cars.
- toomuchtodo 11y ago
  "What's that? I can order my Model S, my PowerWalls, and my solar installation from you? gets out checkbook"
irl_zebra 11y ago
Dealerships are an outdated relic from a bygone era, like the Electoral College. It's not just about "people hat[ing] car dealerships," the issue is that the dealerships are rent-seeking middlemen between the supplier and the customer. Tesla did take that process and make it great: They opened showrooms and you just order online at a specified price. Easy! Not the same as dealerships though.
manicdee 11y ago
I'm not sure what stone you've been hiding under for the last couple of decades, but supermarkets are nobody's friend. As a supplier, supermarkets impose constraints such as, "your apples must be exactly this size and colour, with no blemishes, and cost 5% less than you charges for them last year. If you fail to deliver the 2T per month that we require, you pay us penalty fees. If we don't sell your apples, you pay for disposal. If we have a special on apples, you'll pay us the difference in price. If you sell your apples anywhere else than our supermarket, we charge you penalties." No, middlemen are not great.