Why Tesla Is Fighting With Auto Dealers

Tesla Motors (NASDAQ: TSLA  ) has found success with an innovative car, the electric Model S luxury sedan, and with an innovative retail model -- selling directly to customers via factory stores and the Internet.

Established car dealers don't like that idea, though, and they have an awful lot of political clout. In this video, Fool contributor John Rosevear looks at why this retail model is so important to Tesla -- and at the battles the company is waging to change laws and minds around the country.

Tesla's plan to disrupt the global auto business has yielded spectacular results. But giant competitors are already moving to disrupt Tesla. Will the company be able to fend them off? The Motley Fool answers this question and more in our most in-depth Tesla research available. Get instant access by clicking here now.


Read/Post Comments (9) | Recommend This Article (8)

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  • Report this Comment On June 08, 2013, at 10:29 AM, sabebrush6 wrote:

    So ----- this is what is really happening. The auto dealers want a cut of Tesla's profits and they're not getting it. That's what the whining is all about. They are scared the other manufacturers will see this and it will catch on and they will be out of the middle man money. Whine, whine, whine.

  • Report this Comment On June 08, 2013, at 10:46 AM, ckgod wrote:

    Dealership is one of the very few profession that you can legally lie and cheat. Now they want more law to protect them so no honest people could compete.

  • Report this Comment On June 08, 2013, at 10:52 AM, TMFMarlowe wrote:

    @sabebrush6: Yeah, that's not a bad summary. That, and the big automakers don't dare get near this fight right now for fear of angering their dealers, who in many ways are their real customers.

    Of course, the dealer associations insist that this is all about protecting consumers from unfair automaker practices, but... c'mon.

    Thanks for watching.

    John Rosevear

  • Report this Comment On June 08, 2013, at 11:43 AM, puffn1x wrote:

    Check with BOEING and read about these TESLA batteries. They are dangerous.

  • Report this Comment On June 08, 2013, at 12:20 PM, dickrenoud wrote:

    Hey Tesla, no problem...who ya gonna call? Washington DC, send more money! Not enough, well call Barry again! No one wants your sub-standard car at any price, end the misery.

  • Report this Comment On June 08, 2013, at 2:30 PM, jamesdan567 wrote:

    Substandard car? You are clueless. As for the other boy, gasoline vapors in the tank are extremely dangerous too. So its a wash and you are just chicken little.

    As for dealers, Tesla isn't going to waste a lot of time fighting in Courts. The primary reason Tesla is using the non-dealer model is that it is far more efficient to go direct. The secondary reason is that undertaking a non-dealership model generates tons of free advertising about Tesla. At the right moment, Tesla will execute a pre-planned step to eliminate the whole problem without any additional cost or reduction in efficiency and completely defuse any arguments by existing car dealers in any state. I know what this is. Tesla of course knows this too. This is a chess game folks. Everything that Tesla does is thought out 5,6, 7 or more steps ahead....So lets not get mired down in what they are saying or doing ok? Lets try to write about what they have planned and why it will work. Elon only shows us the tip of the iceberg, just like any good CEO.

  • Report this Comment On June 08, 2013, at 4:42 PM, dugantr1 wrote:

    Now is where the Republican Party machine needs to get behind Tesla and support it. This is where government needs to get out of the way and let the marketplace and free enterprise sort it out. It will be interesting to see where the money falls on this one.

  • Report this Comment On June 08, 2013, at 4:47 PM, snjpage1 wrote:

    Dickrenoud, I guess you didnt read a few weeks back where Tesla paid back the loan they got from the government with interest 10 years ahead of time. They also just announced that they are going to build free charging stations all across the country. Next year they are coming out with a $35,000 car that will go 200 miles between chargings. So why are you bad mouthing them? The GOP hates that a green company is making a profit and they are the reason behind this dealership mess, Especially in Tx where the oil companies do not want these cars to be sold.

  • Report this Comment On June 08, 2013, at 8:23 PM, hdcolo wrote:

    . . Not to different from what the big three auto companies did to the Tucker automobile. . Do whatever it takes to prevent a better idea to take hold. .

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