Could someone explain to a European, in simple words, how the franchise-dealer-factory thing works? If a dealer is the company who actually sales cars and the factory is the one that produces them, why do they need a franchise in between? And how come that a dealer is comparable to a manufacturer Tesla ? Why do they have conflict of interests selling non-gasoline cars?!
A dealer IS a franchisee. They've been given a franchise by the manufacturer to sell (and service and offer financing for) cars in exchange for meeting a variety of conditions. A similar model is followed for many types of chains, such as restaurants. So the dealer is a middleman that performs various tasks that the manufacturer would otherwise have to do themselves. US auto manufacturers originally went with this ap…
Elon Musk: To the People of New Jersey
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Re: Elon Musk: To the People of New Jersey
#222Could someone explain to a European, in simple words, how the franchise-dealer-factory thing works? If a dealer is the company who actually sales cars and the factory is the one that produces them, why do they need a franchise in between? And how come that a dealer is comparable to a manufacturer Tesla ? Why do they have conflict of interests selling non-gasoline cars?!
It's not a franchise in between. The terminology makes it more confusing than it should be. The dealers buy franchise rights (right to sell that product) from the manufacturers, becoming "franchisees" - franchise owners. So my local Chevy dealership has a franchise from GM. Typically they also have rights to perform service and are certified for repairs on various brands.
Re: Elon Musk: To the People of New Jersey
#223Earlier quoted context omitted.
Alternative viewpoint: Christie may already be on his way out or on his way to becoming a lame duck. Musk clearly sees no future for Tesla as long as Christie's admin is calling the shots. Remember, this letter is to "the people of new jersey" and not "the current governor of new jersey". Musk is choosing his venue, the court of public opinion - an arena where Christie is taking some major hits.
If he expects a different result with a Democrat then he hasn't looked at the political contributions of the NJ auto dealers.
Re: Elon Musk: To the People of New Jersey
#224Earlier quoted context omitted.
Could you explain the reference please?
Gov. Christie's office ordered the most heavily trafficked bridge in the country (if not the world) closed for political revenge. He is desperately trying to throw his staff under the bus to avoid accountability for this. It's a very delicate subject for him right now, and Musk bringing it up is cruel and yet at the same time (imho) totally fair play.
Re: Elon Musk: To the People of New Jersey
#225Is it possible for Tesla to just create a shell "autodealer dealer" company in each state. I am guessing they thought of that and legal language prevents its from working.
Re: Elon Musk: To the People of New Jersey
#226I hope people don't forget the profit motive of Mr Musk. It seems technology entrepreneurs have adopted the rhetoric of "just trying to make the world a better place" while conveniently ignoring their own profit making motives. I am no friend of car dealers but I am also not going to be suckered by a self-serving sales pitch. While I don't necessarily support the NJ move, I think we should start asking questions abou…
Re: Elon Musk: To the People of New Jersey
#227Earlier quoted context omitted.
Yeah, I remember those times, too; perhaps less nostalgically than you do. Take your ignition system example. Sure, one could dig in there and replace and adjust the points. But you did it because you had to, you had to do it regularly, and it would be adjusted correctly exactly once: after you did the job. From there, the points immediately started wearing and it would not be exactly right until you did it again. So…
I heartily believe there's a market for both. Compare a Macbook Pro with a custom built Linux desktop. The MBP is very user friendly, plug n play, and has very little customization capacity. The custom Linux desktop is an absolute tinkerer's paradise, with everything from hardware to software being open for customization. The car equivalent of these used to exist for daily drivers, but are now relegated mainly to clo…
Re: Elon Musk: To the People of New Jersey
#228Re: Elon Musk: To the People of New Jersey
#229Paternalistic meddling with free consumer choices is always fraught with peril. Sometimes it is necessary to protect important principles in society. You can't discriminate based on race - that limits choice but who would support the contrary? You can't defraud people in selling products - ditto. You can't buy land to build a smokestack plant in a quiet residential neighborhood - ditto. Many other examples might be c…
Contrary to Mr. Musk's assertion of conspiracy, what seems to have happened here is that there were some unfortunate laws on the books that weren't being enforced. Various business interests (ie the car dealers) complained to the Motor Vehicle Commission. The MVC created a new regulation to reflect the laws already on the books.
Unfortunate? Yes. Should that law get repealed? Absolutely. Should the Governor get involved and push to get the law fixed? Yes.
Conspiracy? No. Suggestions of mafia-like behavior? Childish and insulting, but definitely gets headlines and attention.
Re: Elon Musk: To the People of New Jersey
#230What a joke.
As a european, i can't even comprehend how ludicruous it sounds that a business can't sell it's goods directly. It's so outrageously wrong, that I can't find words that fit adequately.