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Why Texas Bans the Sale of Tesla Cars

BMCM

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It’s being hailed as a game changer. It’s the first electric car to win Motor Trend’s Car of the Year; an unprecedented 99 out of 100 rating from Consumer Reports; and now, according to the National Highway Traffic Safety Administration, it’s also the safest car ever.

But if the Model S really is the car of the future, then why has Texas banned its sales in the state and why are lawmakers in several other states trying to do the same?

Why Texas Bans the Sale of Tesla Cars


What is Texas and those other states afraid of? A little competition won't hurt.
 

Wiseone

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Because Texas is a state where capitalism and competition is still the way of the land, government stays out of private business unlike them socialists in Washington.

Or something...
 

Tigger

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What is Texas and those other states afraid of? A little competition won't hurt.
From what I read it's not about the cars, it's about Tesla's "direct-sale" strategy. Apparently these states have laws requiring a local franchisee to see automobiles. If the Tesla folks don't like the law, work to get it changed; don't just expect to walk through the door and have the rules bent for you.
 

RabidAlpaca

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I'm really sad to see this from Texas, though similar laws exist all over America, they've just been selective about where they apply it.

This is certainly corporate cronyism at its best. I wish our government represented the people and not just those with money.
 

specklebang

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It’s being hailed as a game changer. It’s the first electric car to win Motor Trend’s Car of the Year; an unprecedented 99 out of 100 rating from Consumer Reports; and now, according to the National Highway Traffic Safety Administration, it’s also the safest car ever.
But if the Model S really is the car of the future, then why has Texas banned its sales in the state and why are lawmakers in several other states trying to do the same?
Why Texas Bans the Sale of Tesla Cars
What is Texas and those other states afraid of? A little competition won't hurt.
The article itself answers the question. The Car Dealers Association paid off the legislators to avoid competition. Very simple and straightforward.
 

RabidAlpaca

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From what I read it's not about the cars, it's about Tesla's "direct-sale" strategy. Apparently these states have laws requiring a local franchisee to see automobiles. If the Tesla folks don't like the law, work to get it changed; don't just expect to walk through the door and have the rules bent for you.
I find it hard to believe that you of all people are totally ok with companies buying politicians like packs of cigarettes.
 

BMCM

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From what I read it's not about the cars, it's about Tesla's "direct-sale" strategy. Apparently these states have laws requiring a local franchisee to see automobiles. If the Tesla folks don't like the law, work to get it changed; don't just expect to walk through the door and have the rules bent for you.
What about that Mom and Pop store that sells Levis and Old Navy cloths, they're not franchises. What's wrong with direct sales, it'll save people lots of money. The increase in taxes can only help.
 

Wiseone

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From what I read it's not about the cars, it's about Tesla's "direct-sale" strategy. Apparently these states have laws requiring a local franchisee to see automobiles. If the Tesla folks don't like the law, work to get it changed; don't just expect to walk through the door and have the rules bent for you.
You get upset about all kinds of things but this is just a "meh" to you?
 

ttwtt78640

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It’s being hailed as a game changer. It’s the first electric car to win Motor Trend’s Car of the Year; an unprecedented 99 out of 100 rating from Consumer Reports; and now, according to the National Highway Traffic Safety Administration, it’s also the safest car ever.

But if the Model S really is the car of the future, then why has Texas banned its sales in the state and why are lawmakers in several other states trying to do the same?

Why Texas Bans the Sale of Tesla Cars


What is Texas and those other states afraid of? A little competition won't hurt.
This is not a new tactic at all. Many areas do not accept the use polypropylene piping, some due to the problems of past usage of polybutylene piping (corrosion problems with chlorine in drinking water), but many because it is simply easier for DYI usage and cuts into the need for professional plumbers.

http://www.us.piping.georgefischer....oad&doc_uuid=EB46C94919993E1D4B7A6616023741DE

http://www.nyc.gov/html/dob/downloads/bldgs_bulletins/bb_2011-020.pdf
 

BMCM

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This is not a new tactic at all. Many areas do not accept the use polypropylene piping, some due to the problems of past usage of polybutylene piping (corrosion problems with chlorine in drinking water), but many because it is simply easier for DYI usage and cuts into the need for professional plumbers.

http://www.us.piping.georgefischer....oad&doc_uuid=EB46C94919993E1D4B7A6616023741DE

http://www.nyc.gov/html/dob/downloads/bldgs_bulletins/bb_2011-020.pdf
Apples to oranges. This has nothing to do with the safety of pipes. This just shows that Texas is not as business friendly as they want people to beleave. They're turning down an increase in tax revenue not to mention the jobs Tesla would create. I don't know what the dealers are so afraid of, I don't think the Texans would be flocking to Tesla to trade in their pick ups for an electric car.
 

Cecil900

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This is not a new tactic at all. Many areas do not accept the use polypropylene piping, some due to the problems of past usage of polybutylene piping (corrosion problems with chlorine in drinking water), but many because it is simply easier for DYI usage and cuts into the need for professional plumbers.

http://www.us.piping.georgefischer....oad&doc_uuid=EB46C94919993E1D4B7A6616023741DE

http://www.nyc.gov/html/dob/downloads/bldgs_bulletins/bb_2011-020.pdf
What does that have to do with requiring car dealership franchises?
 

roughdraft274

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So much for that whole "business friendly" state of Texas.
 

ttwtt78640

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Apples to oranges. This has nothing to do with the safety of pipes. This just shows that Texas is not as business friendly as they want people to beleave. They're turning down an increase in tax revenue not to mention the jobs Tesla would create. I don't know what the dealers are so afraid of, I don't think the Texans would be flocking to Tesla to trade in their pick ups for an electric car.
It is not apples to oranges. It is those with a current market share using political pressure to limit competition that would reduce that market share. Selling Teslas in Texas would not "create" anything, for every purchase of vehicle X that is simply one less purchase of vehicle Y, just as every stucture plumbed with PP pipe is one less structure plumbed using another material. What the Texas dealer's are afraid of is setting a direct (manufcturer to public) sales precedent and leaving them, and their larger commissions (profits), out of the loop.
 

ttwtt78640

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What does that have to do with requiring car dealership franchises?
The "service" pprovided by an auto sales dealership is simply that they get a commision (profit) on the sales of cars/trucks. If a factory has direct retail outlets then they will likely "out sell" (out deal?) those that want to add their own markup (commision) to the sale. This sets a precedent allowing any other auto maker to do the same - cut out the middleman "professional auto dealer" and thus their "fair share" of vehicle sales profits.
 

Dittohead not!

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Aha! So, it's the Tessla manufacturers who are the target of this law.

Sounds to me like lobbying efforts on the part of the car dealers.
 

Tigger

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I find it hard to believe that you of all people are totally ok with companies buying politicians like packs of cigarettes.
If this franchising law was a new one, I'd be displeased with it. It appears (from the article) that this law has been around for a while. Assumint it was there before Tesla tried their end run, I have no sympathy for Tesla.

What about that Mom and Pop store that sells Levis and Old Navy cloths, they're not franchises. What's wrong with direct sales, it'll save people lots of money. The increase in taxes can only help.
Clothing is not generally a franchised item. Automobiles are. Nothing wrong with direct sales either, so long as the law doesn't forbid it.

You get upset about all kinds of things but this is just a "meh" to you?
It's "meh" because it's a product that I would never even consider buying.
 

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Here's a simple solution, don't sell in Texas. If folks there really want your product, they'll change the law to allow direct sales.
 

rocket88

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In other news, sales of Teslas went up in Oklahome.
 

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It is not apples to oranges. It is those with a current market share using political pressure to limit competition that would reduce that market share. Selling Teslas in Texas would not "create" anything, for every purchase of vehicle X that is simply one less purchase of vehicle Y, just as every stucture plumbed with PP pipe is one less structure plumbed using another material. What the Texas dealer's are afraid of is setting a direct (manufcturer to public) sales precedent and leaving them, and their larger commissions (profits), out of the loop.
You don't consider that to be a good thing, do you?
 

Smeagol

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The "service" pprovided by an auto sales dealership is simply that they get a commision (profit) on the sales of cars/trucks. If a factory has direct retail outlets then they will likely "out sell" (out deal?) those that want to add their own markup (commision) to the sale. This sets a precedent allowing any other auto maker to do the same - cut out the middleman "professional auto dealer" and thus their "fair share" of vehicle sales profits.
But isn't it fair to me as a consumer to choose whether or not I want or do not want the added value a "professional auto dealer" would bring to the car buying experience and its associated costs?
 
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ttwtt78640

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You don't consider that to be a good thing, do you?
Not at all. Competition is the consumer's best friend in the marketplace. The worst industry for this nonsense is in real estate, where the sales commissions can be huge for very little sales effort at all. It often takes more salesmanship (time and effort) to sell a modest house in normal (barely decent) condition than to sell a pristine mansion, yet the commision is based on a percentage of the sales price.
 

ttwtt78640

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But isn't it fair to me as a consumer to choose whether or not I want or do not want the added value a "professional auto dealer" would bring to the car buying experience and its associated costs?
Of course it is not fair to you to only be able to buy new vehicles via a "licensed" dealer. That is why I buy only used, or present my price data (using Edmunds as a guide) and have them order me exactly what I want (I will never buy off the lot) for a "profit" of 3 to 4%. Some try to talk you out of that, demanding that you add their ADM (Additional Dealer Mark-up), but most simply accept that as a fair profit for simply filling out the factory order form and "preping" the vehicle. I also never let a "dealer" arrange my financing or sell me an "additional/extended" warrantly or added nonsense like "rust proofing" or a bedliner.
 

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Personally, I wouldn't buy a car from the manufacturer - it's hard enough to get satisfaction from the manufacturer through a dealer if you've got a big problem and that guy is in your neighborhood. Try getting some help with your car if you've got to deal with someone several states away.

That said, I don't see that the Big 3, Big 4, Big whatever it is now are going to be overly concerned about competition from a company who's cars start at $60,000. There won't be in my lifetime, nor likely several lifetimes, a big demand for electric cars, and certainly not ones with such a high initial output and no history of lifespan for the product. You can buy four $15,000 cars that will each last you up to ten years, depending on your driving habits, and that's about 40 years of driving.

Cars like the Tesla's are for lottery winners and the idle rich, not for people who drive to and from work and/or have families to squire around to non-stop sports and other practices daily.
 

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Not at all. Competition is the consumer's best friend in the marketplace. The worst industry for this nonsense is in real estate, where the sales commissions can be huge for very little sales effort at all. It often takes more salesmanship (time and effort) to sell a modest house in normal (barely decent) condition than to sell a pristine mansion, yet the commision is based on a percentage of the sales price.
I think with real estate its such a huge investment, if something is wrong you have have a set of professional eyes on it and/or somebody to blame if they didn't see it. In any event, you aren't required by force of law to hire a real estate agent.
 

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Personally, I wouldn't buy a car from the manufacturer - it's hard enough to get satisfaction from the manufacturer through a dealer if you've got a big problem and that guy is in your neighborhood. Try getting some help with your car if you've got to deal with someone several states away.

That said, I don't see that the Big 3, Big 4, Big whatever it is now are going to be overly concerned about competition from a company who's cars start at $60,000. There won't be in my lifetime, nor likely several lifetimes, a big demand for electric cars, and certainly not ones with such a high initial output and no history of lifespan for the product. You can buy four $15,000 cars that will each last you up to ten years, depending on your driving habits, and that's about 40 years of driving.

Cars like the Tesla's are for lottery winners and the idle rich, not for people who drive to and from work and/or have families to squire around to non-stop sports and other practices daily.
I'm not sure if I agree. One of the reasons the Tesla-S set records is after people looked closer, it turned out to be more affordable than people thought. Subtract gasoline costs and its around $500 a month to buy one with no down payment (thanks to Uncle Sam :cool:) or no trade in. Plus they're now getting ready to come out with a Tesla-S lite, that will be a little over half the cost of the current version. If I understand it right, its almost everything in the current Tesla-S but instead of a 230 mile range good for longer out of town trips, you'll need to recharge every 80 to 100 miles making it a more local around town car.
 
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