Ohio Auto Dealers Want Laws to Keep Tesla from Selling Cars Online

[1prophet]

Independently owned dealership puts the wrong floor mats in a Toyota Prius, yadda yadda yadda Toyota is out an estimated $2billion. As far as I know, no defect was positively identified in the vehicles.


You may be right that they are shielded from liability, but it still all gets factored into the purchase price of the vehicles and the labor costs of the mechanics.

It all comes down to what consumers will buy, and consumers are fairly predictable - consumers like cheap. Why are so many Kia's on the road? Because they are cheap. If a manufacturer has to make a decision between sales and reduced liability, they better choose sales, because reduced liability means jack if few are buying your product.

You are only looking at liability, how well does the internet service your Kia, where do you get the loaner car,

You go to the store to buy a box of cereal let's say, you see that box cheaper at another store, and cheaper on Amazon, as long as you buy the same product you can claim a savings, and if you don't like it throw it away and get another brand.

Very few are able to throw away/trade in their car and just get another one if they now don't like it like some cheap junk at Walmart, and need their cars properly maintained and serviced.

Good mechanics are not cheap and the corporate types don't want to pay or incur liability from every little mishap that CHEAP service labor will bring.

The training costs plus support and service personnel will still be needed along with all the rest of the costs the dealer saves the factory if they want full US coverage outside of a few key cities,



Now you know why sears got out of doing many car repairs, and Walmart/Sams with their ability to provide the cheap products you desire stay away from doing more than basic services like tires, batteries and oil changes.

The ability to front load independent dealers with product so the factories can claim sales is a big plus too.

 

[Zaap]

I asked first so why are you asking me ?

Because it's a silly hypothetical question.

 

[smackababy]

And how would you know a new car purchased over the web wasn't in a flood ?

Because a JIT production model doesn't keep a ton of inventory in storage. They produce it JUST IN TIME. So, a flood last month doesn't effect inventory I order today.

I'm no economist, but why would they ramp down production? They supply cars to dealers based on supply and demand. They supply more cars when the dealer demands more because they sold them. Same principal would apply. People shouldn't be demanding less cars simply because the dealerships were no longer in use.

But I suspect in the end, it's cheaper for car companies to use dealerships because it lowers their costs, which the savings would then be (hopefully) passed to us.

I just hate dealing with dealships in general. Such a pain in the ass.

They would ramp down production because dealers act as temporary storage. It is far cheaper to produce in volume and let the dealers store them until they are sold (installing all the extra stuff they can). For Tesla, they probably have a much more JIT style production model. You order the car, put down a deposit, they build it and deliver it to you, then you pay. Tesla isn't producing thousands upon thousands of cars a day, because if nobody buys them all that day, they have no place to put them. The big companies have places to put them; dealerships. They sell the cars immediate to dealerships, who then take on the storage costs, but get margins.

 

[unokitty]

You are only looking at liability, how well does the internet service your Kia, where do you get the loaner car,

When I lived in Japan, I bought a Honda directly from Honda Motor Corp.

When I wanted it serviced, I took it to the Honda maintenance factory. Wasn't a problem.

And Honda Japan, unlike Honda US was never convicted of accepting bribes from their dealers. See:

Former Honda Executives Get Prison Terms : Bribery: Case is called biggest of its kind in U.S. history. Dealers paid $15 million for favors.

The ring operated in at least 30 states throughout the 1980s.

The record shows that US Honda Dealers were involved with, or impacted by, a criminal enterprise that operated in over 30 states for over a decade.

Whatever protection you feel these dealers are providing, I don't need.

Online Tesla sales are already happening. Their customers aren't complaining.

You're welcome to dislike it. But that's not going to keep it from continuing to happen...

If you want to pay a higher price at a traditional dealership, that's your choice.

Tesla's customers want to make a different choice.

I'm okay with that...

Uno

 

[Brovane]

I don't care who owns the dealership. Tesla can own it. Why not?

My impression from the OP is online sales with no presence or license in a state. Sounds like a bad idea to me. Where do go if there are problems? What do you do if there's a recall? What about having the car serviced? Repairs? etc.

I think people mentioning TV etc in this conversation are too young to drive and/or own a car. TV's etc don't have legal titles, registration etc.

Fern

Tesla is putting in factory dealerships. However in several states Tesla is specifically prevented by state law from selling directly to the public. The laws state that a car manufacturer cannot sell directly to the public. How they get around this is in some states is to have a showroom that shows the cars. However the people in the showroom cannot discuss pricing with you. If you want to buy the car they give you a number to call and then you call a person outside the state and you then buy the car that way. So Tesla is having a point of presence.

The other things in regards to repairs etc. Electric cars overall just require less maintenance. I have read several times for people that own a Tesla and live far away from a actual service center. Tesla has essentially mobile mechanics that will come to your house and do the maintenance that is required. As far as recalls because of the way that Tesla has positioned the Model S with the active Internet access most re-calls have been handled by over the air software updates. Which again doesn't require you to take the car into a dealership. If you owned a regular car and needed a software update you would have to take a trip into the dealership. Which is more convenient, waking up in the morning with a notice on the screen of your Tesla that their is a update to apply at your convenience or having to schedule a appointment to take your car into a dealership and deal with that?

 

[cliftonite]

I don't care who owns the dealership. Tesla can own it. Why not?

My impression from the OP is online sales with no presence or license in a state. Sounds like a bad idea to me. Where do go if there are problems? What do you do if there's a recall? What about having the car serviced? Repairs? etc.

I think people mentioning TV etc in this conversation are too young to drive and/or own a car. TV's etc don't have legal titles, registration etc.

Fern

Consumers who want to buy a Tesla would be aware of these limitations right? If they are willing to buy it why prevent them?

 

[DucatiMonster696]

I'm pretty sure we've had this thread before.

There are a lot of good reasons to prevent auto manufactures from selling online.

E.g.: IIRC Tesla is located in CA. I live in NC. An auto is generally your second most expensive (asset) purchase. If I do business with Tesla, who aren't licensed in NC and have a problem I'm pretty much helpless. My state (NC) has no jurisdiction over Tesla.

It works the same way for health insurance and many other products.

I thought states already outlawed direct sales anyway. And you can't just make an exception for one manufacturer.

Anyway, in the other thread were a bunch of reasons Tesla shouldn't be allowed to sell online.

Fern

Unless of course Tesla establishes a presence in the state by the way of a service center(s) which then addresses this point IMHO. Then again what level of guarantee does a person face when they buy a car (or motorcycle, etc) out of state via E-Bay or Craigslist, etc? Of which is not something that is out of the ordinary in this day and age.

 

[Mr.IncrediblyBored]

Cheeseburgers don't get recalled, need serviced, require a a legal title, require registration and licensing.

Fern

What the hell do any of those things have to do with franchise/corporate stores? Service and recalls still happen at a local corporate owned service center. Title and registration is based on the county you live in, which again has nothing to do with the ownership of the showroom.

 

[Mr.IncrediblyBored]

(I'm seeing two different changes recommended here: (1) internet sales by out-of-state manufacturers and (2) dealerships owned by manufacturers. Each needs to be addressed separately.)

Fern

Thank you, Government, from saving me from tax and title issues. I run into the same issues buying a car out-of-state right now.

Your entire argument is a strawman. There are no Tesla franchises right now so there are no competition issues. When Tesla starts selling licenses, if you don't want compete against corporate, don't get a franchise.

 

[z1ggy]

Because a JIT production model doesn't keep a ton of inventory in storage. They produce it JUST IN TIME. So, a flood last month doesn't effect inventory I order today.



They would ramp down production because dealers act as temporary storage. It is far cheaper to produce in volume and let the dealers store them until they are sold (installing all the extra stuff they can). For Tesla, they probably have a much more JIT style production model. You order the car, put down a deposit, they build it and deliver it to you, then you pay. Tesla isn't producing thousands upon thousands of cars a day, because if nobody buys them all that day, they have no place to put them. The big companies have places to put them; dealerships. They sell the cars immediate to dealerships, who then take on the storage costs, but get margins.

Yeah, you make a good point. Only thing I could imagine is manfs. store the product near by on a lot of their own, but that's probably not really a possibility if they are in a large industrial setting.

 

[her209]

Seems like a lot of you want to cause higher unemployment by moving to web based sales. Think of all those dealership jobs you'll be ending. Why do you hate hard working Americans?

At least they'll get an unemployment check. Am I right?

 

[zinfamous]

This is what I was thinking... One of obama's first scandals was to purge dealership owners who had not donated to democrats.

holy shit, guys! VG pretty thoroughly put the Kibosh on that FUD with two very easy to read, very easy to understand, and thoroughly data-driven links.

http://www.snopes.com/politics/business/chrysler.asp

http://www.fivethirtyeight.com/2009/05/news-flash-car-dealers-are-republicans.html

MATH!

 

[zinfamous]

So buying and owning a car is just like a cheeseburger?

Cheeseburgers don't get recalled, need serviced, require a a legal title, require registration and licensing.

We don't have unfair consumer legislation for cheeseburgers. Nobody needs a state agency if there's a complaint about the cheeseburger. Cheeseburgers don't get repossessed.

They're nothing alike.

Fern

Not to reject your overall point (because I do agree with it), but cheeseburgers do get recalled

http://www.ibtimes.com/meat-recall-...d-beef-recalled-rancho-feeding-corp-full-list

Also, you do need state and federal agencies wrg to complaints about cheeseburgers. Remember Jack N The Box c mid 1990s?

 

[zinfamous]

And how would you know a new car purchased over the web wasn't in a flood ?

Any sensible online purchaser would ask for and get the VIN before agreeing to purchase.

Same as you would buying from a lot.

 

[Fern]

Tesla is putting in factory dealerships. However in several states Tesla is specifically prevented by state law from selling directly to the public. The laws state that a car manufacturer cannot sell directly to the public. How they get around this is in some states is to have a showroom that shows the cars. However the people in the showroom cannot discuss pricing with you. If you want to buy the car they give you a number to call and then you call a person outside the state and you then buy the car that way. So Tesla is having a point of presence.

The other things in regards to repairs etc. Electric cars overall just require less maintenance. I have read several times for people that own a Tesla and live far away from a actual service center. Tesla has essentially mobile mechanics that will come to your house and do the maintenance that is required. As far as recalls because of the way that Tesla has positioned the Model S with the active Internet access most re-calls have been handled by over the air software updates. Which again doesn't require you to take the car into a dealership. If you owned a regular car and needed a software update you would have to take a trip into the dealership. Which is more convenient, waking up in the morning with a notice on the screen of your Tesla that their is a update to apply at your convenience or having to schedule a appointment to take your car into a dealership and deal with that?

We've had recalls over floor mats. It's not just parts for the internal combustion engine that get recalled.

Seat belts etc; all kinds of problems require a recall.

Fern

 

[Fern]

Consumers who want to buy a Tesla would be aware of these limitations right? If they are willing to buy it why prevent them?

I suppose you're unfamiliar with the average American?

No matter how stupid their actions, no matter how much fault rests with them - and this is particularly true for dumber ones - they're going to complain to their Congressperson or other govt agency. You might say they will just complain to a lawyer, but lawyers are only happen to listen after write a big check.

I still don't see why you f'up a system that works perfectly well just to benefit some boutique company. Oh, yeah, it's 'green' and is the darling of libs.

Like I said before several times, you let Tesla do this, you gotta everybody else do it.

No thanks.

Fern

 

[Fern]

What the hell do any of those things have to do with franchise/corporate stores?

Thanks, that was my point.

Franchise burger places etc have nothing to do with auto's

Service and recalls still happen at a local corporate owned service center. Title and registration is based on the county you live in, which again has nothing to do with the ownership of the showroom.

Title and registration is NOT based on county. The DMV is a state agency (at least for every state I've ever seen). Some counties, depending upon state law, do have personal property tax for motor vehicles though.

Fern

 

[Fern]

Thank you, Government, from saving me from tax and title issues. I run into the same issues buying a car out-of-state right now.

Your entire argument is a strawman. There are no Tesla franchises right now so there are no competition issues. When Tesla starts selling licenses, if you don't want compete against corporate, don't get a franchise.

You don't know what a strawman argument is. I'll help you:

A straw man, also known in the UK as an Aunt Sally,[1][2] is a common type of argument and is an informal fallacy based on misrepresentation of the topic of argument. To "attack a straw man" is to create the illusion of having denied a proposition by replacing it with a different proposition (i.e., "stand up a straw man") and then deny it ("knock down a straw man") instead of the original proposition.[3][4]

http://en.wikipedia.org/wiki/Straw_man

As I've made abundantly clear any number of times previously, you let Tesla sell directly you will have to let every other auto manufacturer do it as well.

Fern

 

[piasabird]

Auto dealers sell cars online as well. This could be a shot in the foot for them. Make Ford and the others take down all their web pages.

 

[cubby1223]

Auto dealers sell cars online as well. This could be a shot in the foot for them. Make Ford and the others take down all their web pages.

Ford doesn't sell directly to the consumer through the web.

You can be angry all you want about the dealership model, but at least understand that dealerships are independently owned.

Go on Ford's main website, browse for cars, everything done on Ford's website is to direct you towards a dealership near you for the actual purchase. Ford does not sell cars to consumers. Dealerships sell new Ford cars to consumers. You cannot buy a car from Ford's website, you can search their vehicles and the options available for them, but when it comes to making a purchase, you must complete the sale through an independently owned dealership.

 

[Fern]

Auto dealers sell cars online as well. This could be a shot in the foot for them. Make Ford and the others take down all their web pages.

I think you can select/build your car through the manufacturer's website, but the actual sale takes place through the dealer.

Fern

 

[BoberFett]

LOL, politics certainly brings out the fickleness of people.

"I hate locally owned dealerships and small businesses! Let the billionaire do what he wants!"

 

[cubby1223]

You are only looking at liability, how well does the internet service your Kia, where do you get the loaner car,

I didn't say Kia's are cheap because they are only sold on the internet.

Kia's are sold through dealerships like every other major car brand.

The Kia's start at ~$13,000 new, while Ford vehicles start at ~$17,000 new.

I don't know what Kia does differently that reduces their costs by that great an amount, I was just making the point that consumers prefer lower prices.


For example, I don't think dealership owners are worried as much if Ford could sell directly through the internet, but they would absolutely go under if Ford decided to operate a dealership nearby, by not being able to compete on price.

 

[Fern]

LOL, politics certainly brings out the fickleness of people.

"I hate locally owned dealerships and small businesses! Let the billionaire do what he wants!"

I'm gonna quote this now because I'm waiting on one of the Libs/Dems to actually state their real intentions. (It certainly isn't supporting the billion dollar mega company over the smaller million dollar company.) Then I'll re-quote it.

Fern

 

[Mr.IncrediblyBored]

You don't know what a strawman argument is. I'll help you:

http://en.wikipedia.org/wiki/Straw_man

You brought up a bunch of points about title and registration that have nothing to do with corporate or franchise ownership. Then tell me I don't understand what a strawman is. Right.

As I've made abundantly clear any number of times previously, you let Tesla sell directly you will have to let every other auto manufacturer do it as well.

Fern

How the fuck do you figure? Franchisees have contracts that protect their rights. Just because Tesla starts selling online or at locally owned showrooms, doesn't mean Ford can too. Tesla has no franchises to compete with. They should be allowed to do whatever the hell they want.

About your other point, sales tax on cars in Ohio is based on the county it will be registered in. The BMV is a state agency, but registration and tax is county specific.