News: New Jersey Bans Tesla Sales

DannyITR

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http://www.guideautoweb.com/en/articles/24370/new_jersey_bans_tesla_sales/


Tesla isn’t your standard automaker. They build cutting-edge electric vehicles with the latest technology that produce zero emissions and are actually desirable to look at and drive.

That is not the only aspect that sets Tesla apart, however. Instead of having a vast dealer network to sell its vehicles, Tesla sells directly to the public. They have small stores inside malls to sell cars and have located their service centers elsewhere. This non-traditional approach is causing them problems in many states with the latest being New Jersey.

A new law comes into effect April 1st that requires new car dealers to have a franchise agreement in order to get licensed. Since Tesla is the seller and the manufacturer, it can’t create the agreement with itself, therefore making any Tesla dealers in the state illegal. Arizona, Colorado, Virginia and Texas all have similar laws in place which ban new Tesla sales.

Tesla will be appealing the decision.

WTF is this shit? Tesla is one of the most revolutionary companies we've seen in decades but I guess they are shaking things up a little too much. I can't see any rationale for denying them to sell their own cars. If they can provide their product at a lesser price by cutting out the middle man then I think it's great.
 
Maybe some big shots like Rex Tillerson and John Watson made some charitable donations to the Chris Christie foundation
 
Think about it this way. Banning Tesla appeases 3 Groups:

1. Domestic car manufactures. They don't have cars that can compete in the category of the model S.

2.Oil companies. These cars represent the death of their industry.

3. Unions. Cutting any employees anywhere represents less potential members for them.


Any one of these 3 affected groups could have lobbied for these measures.
 
Ya pas juste au QC qu'on se fait avoir vous voyez!


Pour ce qui est des compagnies pétrolières qui poussent, j'en doute fort. L'industrie de l'aviation, camionnage, navigation et chauffage prennent pas mal la plus grosse partie du pétrole et ça changera pas demain, même si on roule tous en Tesla
 
While I understand that cars dealers and the oil industry are responsible for many many jobs, clinging to outdated technology for the sake of creating jobs will only hold back a society. If we did away with gasoline powered cars and dealer networks, jobs would be lost on the short term but new industries would appear to compensate.
 
I really don't get it.... Unless they ban Tesla in all USA, the customers could buy their car in another state (with no or low taxes for example) thus priving NJ from getting sales taxes...
 
I really don't get it.... Unless they ban Tesla in all USA, the customers could buy their car in another state (with no or low taxes for example) thus priving NJ from getting sales taxes...

Faut pas chercher à comprendre avec les USA des fois...

J'irais juste acheter mes chars au NH rester là bas.

Un peu comme le Jack Daniels qui est fabriqué dans un Dry County
 
I really don't get it.... Unless they ban Tesla in all USA, the customers could buy their car in another state (with no or low taxes for example) thus priving NJ from getting sales taxes...

you pay the taxes when you register it. like us at the SAAQ when you buy an out of province car.

Dono't worry they do get the taxes
 
Lobbying from the big boys at its best.. doesn't use gas? no dealer? no money to be made? ban that sh*t
 
En faite le but n'est pas de faire chier Tesla, ca rien a voir avec eux en faite.

En étant le constructeur et en vendant directement au client sans passé par le pallier de l'état fait en sorte que tu bypass certaine regles de fiscalité.


Tesla doit simplement ouvrir une business indépendante au New Jersey qui a pour tache d'etre un franchisé de Tesla, ensuite batir un contrat avec le franchisé et le franchiseur (Tesla USA) et that it.


Anyway si Tesla devient plus populaire ils n'auront pas le choix d'investir dans des infrastructures locals avec des dealers, des garages, showroom, etc.
 
Why doesn't Tesla make their stores/outlets into franchises that would bypass the law no?

That's the point, other companies have franchisees who sell the cars Tesla doesn't use that model and sells direct, they say it hurts the franchisees but they never had any so the point is moot, that being said other companies might catch on and ditch their dealer model. I guess that's what they don't want.
 
En faite le but n'est pas de faire chier Tesla, ca rien a voir avec eux en faite.

En étant le constructeur et en vendant directement au client sans passé par le pallier de l'état fait en sorte que tu bypass certaine regles de fiscalité.


Tesla doit simplement ouvrir une business indépendante au New Jersey qui a pour tache d'etre un franchisé de Tesla, ensuite batir un contrat avec le franchisé et le franchiseur (Tesla USA) et that it.


Anyway si Tesla devient plus populaire ils n'auront pas le choix d'investir dans des infrastructures locals avec des dealers, des garages, showroom, etc.

^
all of this
 
En faite le but n'est pas de faire chier Tesla, ca rien a voir avec eux en faite.

Oh Really?

T'es vraiment naïf si tu crois que ce nouvelles lois on rien à voir avec Tesla et leur modèle de vente qui vient mettre une grosse épine dans le modèle de vente courant.

non, Tesla a pas besoin de "dealer" indépendants avec des grands parking bourrés de banderoles pour attirer les poissons
non, Tesla a pas besoin de garage franchisés et trop souvent déconnectés de la maison mère qui, en plus, offre du service de marde en sous-traitant aux joblos du quartier (à 85$/h) l'entretien de ton véhicules tout en te faisant miroité que tout ce fait dans leur beau garage immaculé
NON, Tesla a pas besoin de "show room" de 50000' carré. On est au 21ième siècle et le monde est prêt à faire l'achat de véhicule par internet, avec un catalogue en ligne pour les couleurs, les options et les finis.

Si c'était JUSTES des lois existantes, je me dirais, meh, mais c'est des lois que des lobbyistes veulent passer maintenant et c'est clairement pour mettre des bâtons dans les roues d'un nouveau modèle qui leur fait compétition. T'es d'habitude un fan du "libre marché" il me semble...

Ça va être quoi la connerie votée demain?

Un excellent article sur le sujet

http://www.wired.com/business/2014/03/tesla-banned-ensure-process-buying-car-keeps-sucking/

New Jersey is banning Tesla.

No, you won’t get pulled over for driving your Model S on the Turnpike. But if rules passed yesterday by New Jersey regulators and backed by GOP Governor Chris Christie take effect, you won’t be able to visit a Tesla store in the state. In an effort to project traditional car dealerships, New Jersey is trying to shut the electric car dealer down before it ever gains traction.

This isn’t the only place where Tesla is battling such bans. Across the country, powerful car-dealer lobbies with their hands in politicians’ pockets are fighting the electric car maker, trying to hold on to monopolies protected by outdated laws. But there is some solace to be taken in the New Jersey decision: It calls attention to the hypocrisy of supposed free-market politicians propping up an unloved industry at the expense of real competition.

Unlike typical car dealerships, Tesla showrooms aren’t surrounded by parking lots filled with vehicles and high-pressure salesman trying to get you to drive off in one. The stores are typically at malls, such as the two where Tesla operates in New Jersey. Customers can examine a floor model, learn about the design and engineering process, and schedule a test drive. One thing you don’t have to do at a Tesla store, however, is buy a car. Purchasing a Tesla happens online, straight from the company, which you can do from anywhere. In other words, they work the way retail should work.

Tesla is able to ensure the consistency of its retail experience because it sells directly. That’s exactly the tie that the car dealers and their political cronies want to sever. Under the status quo, dealers are powerful middlemen who enjoy serious leverage over carmakers and customers, as well as a decided lack of accountability thanks to the territorial monopolies created by the franchise model. If Tesla’s stores were allowed to stay in business, car shoppers might start to ask why the process of buying a car from the old guard has to be so lame.
The New Jersey Middleman

In New Jersey, as in other states, the law requires that auto sales happen through a middleman franchisee — the dealer. Yesterday, the state’s Christie-stacked Motor Vehicle Commission effectively found that Tesla’s model violated those regulations. The Christie administration has argued that the law is the law: “This administration does not find it appropriate to unilaterally change the way cars are sold in New Jersey without legislation and Tesla has been aware of this position since the beginning,” Christie spokesman Kevin Roberts said, according to Bloomberg.

Tesla says it was railroaded in the process after assurances from the Christie administration that it wouldn’t be. But whatever the case, this is a startling inversion of political stereotypes: Northern Californian capitalists quashed by East Coast Republicans defending the use of government regulations to keep competition out of the marketplace.

To understand how this strange mirror world came to be, you have to go back a century. In the early days of the U.S. auto industry, carmakers had all the power. The automakers relied on local dealers to distribute and service the vehicles they made. But once those dealers had invested in inventory and facilities, Ford and General Motors could force those dealers to take cars they couldn’t sell or face the possibility that the car companies would find another dealer, as recounted in a great Planet Money episode last year on why the process of buying a car still sucks. If that happened, dealers would lose all the money they had put in to setting up their businesses. States began to enact franchise rules that gave dealers exclusive sales rights in local markets to prevent automakers from extorting dealers with the threat of underwriting a competitor across the street.

But as any free-market fanboy will tell you, monopolies come at a serious cost, especially to consumers. By giving dealers exclusive territories, car manufacturers lost not only the leverage they had over dealers to force inventory on them, but also much ability to enforce standards of pricing or service. Yes, dealers still had to compete with other brands in the neighborhood. But otherwise, they lacked accountability. They could be as sleazy as they wanted to be.

In the ensuing decades after franchise rules became widespread, dealers became politically savvy operators who ingratiated themselves to the politicians who could protect their uniquely cushy arrangement. Henry Ford may have twisted the arms of dealers a century ago. But today, it’s the dealers and their lobbyists who ensure that alleged free marketeers like Chris Christie and the Republican-controlled state of Texas keep actual innovation out of their states.
Tesla Stands Alone

This time around, however, the automakers are also complicit. Tesla is battling a bill in Ohio, for instance, that would force it to go through franchise dealers in the state. According to Bloomberg, General Motors submitted written testimony to an Ohio Senate panel supporting the plan that would limit Tesla to the two stores already open in the state. “Tesla is an automobile manufacturer, they compete with our vehicles in the market, and they should compete under the same laws we do,” the not-so-long-ago bankrupt automaker said.

Fair enough, except that the real-world consequence wouldn’t be to level the playing field. It would be to crush an upstart competitor before it even establishes a foothold in Ohio. General Motors may sell many more cars than Tesla, but you can bet new CEO Mary Barra is deeply aware that investors are growing increasingly confident in Tesla as the future of U.S. car-making.

A year ago, GM’s stock closed at $28.07. Today it’s hovering around $35 per share — a 25 percent return, which isn’t too bad. Compare that to Tesla: $39.12 a year ago, more than $241 today. That share price values Tesla — a startup just a few years old, that still numbers the cars it’s sold in the thousands — at more than half the market cap of GM, once the biggest company in the world. For now, GM doesn’t have to worry. Tesla still only makes luxury vehicles. But if it succeeds in mass-producing an electric car that the average American family could afford, as it aspires to do, the U.S. auto market could look a whole lot different.
The New Apple

Dealers understand this too, not just in terms of the cars that customers buy but how they buy them. If Tesla stores were allowed to flourish, customers might see that buying a car doesn’t have to suck. The reason that this suckiness is sustainable owes everything to the outdated franchise model that allows car dealers to wallow in complacency. And these dealers are right to worry.

Tesla stores are often compared to Apple stores, and the similarities are more than just aesthetic. Like Apple, Tesla runs its stores on its own, and it’s wholly motivated to give customers what they want. Apple stores have set the 21st-century standard for selling gadgets in physical stores. If Tesla is allowed to do the same, car dealers will actually have to make fundamental changes to compete.

That competition would be good for consumers, but it also explains why dealers won’t let state franchise laws die anytime soon. The sad truth is that most of them don’t have what it takes to compete against a any company with Tesla’s future-facing sensibility. If regulations protecting middlemen go away, these dealers will go the way of CompUSA. And as with barn-like big-box stores for selling computers, no one would miss them.
 
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