FTC to Host Public Workshop Examining the U.S. Auto Distribution System Workshop Will Explore Competition, State Regulations, and Emerging Trends in the Industry, Project No. P131202
It amazes me that laws originally intended to keep OEM auto makers from abusing their franchised dealers by bypassing them to sell direct after they have helped build the OEM's brand and goodwill in local areas, are now being used by the dealers to block out new auto makers and enforce their monopoly on auto sales. I live in Massachusetts and own a Tesla Model S. When I shopped for my car in 2012 Tesla was blocked from sales activities in MA due to a dealer association lawsuit so I had to go to Tesla's Westchester, NY store for a test drive. The Massachusetts Supreme Judicial Court fortunately ruled appropriately in that case - the dealers had no standing to claim harm from Tesla's direct sales because they had no relationship with Tesla to begin with. Dealers claim that they are acting in the interest of consumers, however I fail to see how restricting consumer choice is consumer-friendly. And as for their claims that automakers are unable to provide service, I have received better service from my local Tesla service center than from franchised dealers of three different brands I previously owned or own, including luxury brands. Also it is clear that Tesla's success in electric vehicles (sold the most EVs in 2015, despite an average selling price 2x+ the competition) is the result of not only a great product, but the right sales model. I have heard too many stories of people trying to buy other EVs (Leaf, Volt, Focus Electric among others) who were repeatedly dissuaded from doing so by dealer staff. I once spoke to a Nissan dealership's sales manager to inquire about using their charger on an upcoming trip - he wasn't aware they even had a charger, something all Nissan dealers have. Dealers are threatened by EVs with simpler drivetrains and lower maintenance and service requirements. If they are protected they will continue to ignore the consumer's best interests.