The topic/question:Tesla direct to consumer sales
The question: I know that you are not in today when Mr. Edwards spoke of Tesla bypassing dealerships, and that it would be a bad thing. I am confused on how it would be bad. He had mentioned that there would be a loss of jobs, wouldn't the Tesla sales Centers need a sales and service center?
Bottom Line: I received this question last week (while I was on vacation).This topic has been red hot recently as New Jersey took action to ban the ability for Tesla, which had opened stores inside its state, to be able to sell their products direct to the consumer.So let's get into it...
The traditional dealer certainly does offer a benefit to many customers including:
The ability to easily test drive many different products, even from different brands Guidance on what vehicle may best suit your needs
So as a consumer you may choose to patronize a traditional dealer even if you had the option to buy direct from an auto company.But to the premise of the question...In my view it's not a matter of if but when we do have the option to buy direct from a manufacture if they choose to sell directly to us.Why do I have that view?Because it's already common place with so many other consumer products...
Apple is a $480 billion company (as I write this entry)
And even as the largest company in the world they have the ability to sell their products directly to you through their website or their own company stores. Now Apple products are still sold by virtually all companies that sell consumer electronic products.More sales actually still come from 3 rd party vendors than direct from Apple because consumers choose to buy from those other companies.But that's the key - consumer choice.
If Tesla or any other company were to sell direct to you they would have to account for ongoing service and parts needs as your question suggests.That would mean either opening physical service centers and/or contracting with existing dealer service centers for other brands, so yes people certainly will need to fill those roles but that's actually beside the point anyway.If we treated retail commerce as a protected industry on-line sales would be banned.How many hundreds of thousands of retail jobs have been lost to online retailing?The jobs argument really isn't one that can justifiability be used in the Tesla example.
So the end result in my view is that it's a matter of when, not if, Tesla and/or other automotive companies have the ability to sell direct to you...And you will decide what and where you'd like to buy it.Just as in the Apple example it wouldn't mean the end of the traditional auto dealer.They would just have to adapt to the changing times like virtually all other retail business.
If you have a topic or question you'd like me to address email me: brianmudd@clearchannel.com Audio Report:
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