mmarshall

On the virtual test-drives, I understand what you're saying, but I don't quite agree. There would probably be too much temptation for the automaker to try and doctor the software to give the impression of a smoother/quieter ride, better handling, faster steering response, less road/wind/engine noise...whatever the scenario may be that they are trying to project, and give a false impression of the vehicle.

And that basic practice, of course, in itself, is nothing new......it goes back decades, to before computers were introduced. Manufacturers have attempted to make press-introduction vehicles look and feel better, for the reviewers, than actual production models to follow (one reason, among several, why I myself pick average vehicles sitting on the lot when I do a review). One of the most famous examples of this was the introduction, in 1979-80, of the ill-fated GM X-Body compacts...Citation/Phoenix/Skylark/Omega (I owned one of them myself). Car and Driver magazine later published a policy-admission, and a formal apology to its readers, on how they had been duped by GM marketers, who had sent them (unbeknown to the magazine at the time) specially-constructed / inspected / doctored samples of these new FWD compacts that were far-better-built and performing than the actual production models. The actual production models were so poorly-built and engineered (and sold at record numbers...Chevy sold over 900,000 Citations alone that first year, independent of the other three models) that they had class-action suits and a record number of recalls.

patgilm

Your furniture analogy isn't a good one. Where I live the furniture stores carry a number of different brands and is the same as a dealer (with the exception of some like Pottery Barn, Restoration Hardware, etc.). They buy wholesale and ask MSRP but nobody ever pays MSRP for furniture. Also, whenever we buy furniture (which we did last year) every piece had to be made, there was no inventory or warehouse and we had to wait 6-8 weeks to get them. It would have been nice to have a central warehouse to have stock so I could have had it within a couple days instead of weeks but that is not how it works.

4TehNguyen

iTrader: (1)

it doesnt matter what the brand is, it is inventory, regardless if its 1 manufacturer or 10. Having inventory that sits around for months is expensive, especially for new vehicles which have huge depreciation once used. Guess whos paying for it, not the dealer.

one excerpt:
https://www.mercatus.org/publication...ks-auto-buyers

wonder why a new car has what 20% depreciation once you drive it off the lot? Theres part of your answer there, the dealer is causing close to 10% of that. Dell computers dropped the price and practically put a computer in everyones home by doing a direct to buyer sales model.

coolsaber

So whose paying to upkeep 27,000 vehicles at a central location per month? And again, back to this whole protectionist thing, yes I agree that its surprising to have laws in place to protect a dealer, but what benefit would reduced costs make a dealer say, "im going to reduce end customer cost and forgo a great opportunity to increase my margins?" Its not like they have to make this a loss leader, drop prices just to get market adoption. They dont. Lexus is an established brand.

coolsaber

And again, ok reduced dealer costs have translated to lets shift market dynamics to make the customer happy and screw our longtime growth opportunity. I think Tesla, whose basically the who crux of the thread, keeps depreciation at $1 per mile? When was the dell computers price drop?

Gojirra99

That is the setup in Greater Vancouver, 4 of the 6 Mercedes dealerships are corporate stores owned by MB Canada, the other 2 are franchises, there has been both for years.

Gojirra99

Where we are, we only pay sales tax (up to almost 17% for a luxury car) on the net amount of the agreed price of the new car minus the trade-in value of the old, making selling the old car privately not worth the hassle for most because of the tax savings.

LexBob2

Same here where I live. Except the 17% tax part.

mmarshall

17%......that's a lot. Sounds like the authorities there in Vancouver reach pretty deep into people's pockets. By U.S. standards, you're probably getting screwed, but, if that high a tax-and-spend system is what the population wants (or tolerates), I guess that's up to you and the politicians you vote into office.

My0gr81

So that puts the buyer behind the 8 ball, since Tesla doesn't take trade ins. They pay the tax on the full price.

Och

iTrader: (3)

What makes you think that a manufacturer is going to be more efficient than a dealer? Its not like manufacturers never have incompetent people working for them - just look at the big three and their problems. And if UAW forces corporate auto stores to employ union employees, its going to be way worse experience and cost for the consumers. And everyone loves to say that dealers are dishonest, etc - well look at VW and the diesel scandal.

MattyG

But did DeLorean try to cut costs with things like faulty ignition switches that got people who owned GM products killed?

IMHO you also have know who is doing the talking on these types of tv and press programs and what they've done in the past. Lutz talks about Tesla's unsustainable business model yet he was in the upper ranks saying nothing about the corporate welfare bailouts of the Obama administration to the tune of $11B back in 08/09. What exactly was GM's business model then? And we know now that Chyrco's taken two government bailouts/loans.

If he's so keen on GM stock, how come he dumped it back then, as the winds changed? He and those in the upper ranks, selling like crazy.

http://www.businessinsider.com/henry...kruptcy-2009-5

Yes this is the thing to think about. There are already issues in the summers during high demand hours. So if a good percentage of the driving population adopted EV's and then you saw everybody rushing to plug in their fancy 240 volt vehicle at around the same time... you might have an issue.

As far as the Tesla retail model, it's what a new startup does. So for now, direct selling and small stores is what it can do well. But Tesla is fighting headwinds with an established vehicle infrastructure. Tesla can't possibly try and change the whole transportation infrastructure overnight. It took a century to establish a huge network of gas stations that dovetailed with the evolution of the internal combustion engine.

Toys4RJill

Do well? Tesla is not making any money. How could they be doing well? This is why I have said that what Tesla is doing is nothing all that great. There is at least a 14 day wait for their cars to be delivered from what I understand, they don't take orders, and people are paying MSRP for the cars. That totally sucks if you ask me.

MattyG

You are rehashing several posts worth of arguments about Tesla not making money. Not delivering instantaneously, not giving buyers some huge inventory to pick from on a lot. Losing money on each car. These are likely talking points planted by the people who feel threatened by Tesla's innovation. And I'm not even a cool-aide drinker. I think if they fail, then they fail. What's it to you?

The question that's being debated is whether or not Tesla will change the automotive world's retail distribution model and whether they will be able to overcome the hurdles in front of them. If we judged by the standards you're talking about, GM, Ford and Chrysler might have never made it past the goal posts. Is it Tesla that went running to Big Government for a massive multi-billion dollar welfare loan while that industry's executives pocketed huge multi-million dollar salary packages and flitted about on private jets... while dumping the stock in their own companies?

Toys4RJill

Pointing it out because they are not successful. Yet the BS media tries to make it look like they are doing this great thing. Yes they have a very, very, very good car. But yet they make no money.

I don't see anyone trying to copy what they are doing. The Genesis brand can barely get off the ground with no delears for people to go. A large retail network with a proper inventory is the only way to succeed selling cars. Yet everyone wants to say it's not efficient.....yet Tesla makes no money.