Attention Dealers: Don’t Just Oppose Tesla’s Elon Musk – Learn How He Thinks!

Elon Musk in Tesla showroom

by Jon LeSage, contributing editor, Dealer Digest Daily

SITUATION:
• For those following electric vehicles, Elon Musk would probably lead the list of “celebrities” (right in front of Henrik Fisker and Bob Lutz). He gets a lot of media play and does a good job of milking it, including sending out zingers through his Twitter account.

• Automotive News has been covering the battle between state dealer associations and Tesla Motors in recent years, where state lobbying efforts and lawsuits have made for big deals especially in Massachusetts and New York.

• Texas has seen the latest stage, where Musk made a splash testifying before state lawmakers on why Tesla should be allowed to set up retail spaces in the state without complying to longtime dealer franchise laws.

• Here’s a few highlights from the conversation with Automotive News’ Amy Wilson:
SIGNIFICANCE:
• Tesla wanted to see dealers commit to setting up an exclusive Tesla store and sell a certain number of the electric luxury cars, and that commitment from dealers didn’t happen. So they set up their own retail showrooms.

• Tesla would commit to working with franchised dealers in Texas if Tesla sales exceeded 5% of new car sales in the state per year, but they’re a million miles away from that.

• Musk has given several examples of EV startup companies failing after setting up franchised dealer networks, with Fisker being one of them. He does acknowledge there were other factors at play, especially Fisker’s battery supply struggle with A123 Systems. But, unsold inventory at Fisker was the determining factor.

• Musk is also considering bringing his SpaceX company over to Texas as well. It would be the world’s first orbital space port on the south coast of Texas near Brownsville, he said.

• A message to dealers: There’s better things to do than attack Tesla. It’s a small company selling a small number of cars – trying not to be “yet another body in the graveyard of car company startups.”

Source: Automotive News

 

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