Car Dealers Are Becoming Scared of Tesla

Cars have been sold the same way for over a hundred years: through car dealerships. Dealers were essential for the rapid expansion of automakers, allowing them to reach every corner in the country. To protect these dealerships, specifically from manufacturers competing against them after growing to be large enough to afford their own retail operation, laws were put into place to prevent manufacturer-owned stores.

These restrictions only apply to automakers who have franchised dealerships. New automakers who don't sell franchises can, albeit with some limitations in some states, open their own stores and sell cars directly to consumers even over the Internet. Automakers are always on the lookout to save every penny they can, and the economies of scale from owning their own retail operation could save millions or generate profits that are taken by middlemen (dealerships).

With restrictions being placed on only some automakers, there is no longer a level playing field. The rise of Tesla has amplified the benefits of a direct-to-consumer sales model, and if automakers are to compete they will need to figure out a way to control way their cars are sold. Ultimately, this could spell the end for the dealership only sales model.

#Tesla #Dealerships

Видео Car Dealers Are Becoming Scared of Tesla канала Sean Chandler