Should car manufacturers be allowed to sell vehicles directly to consumers?

[Indy Texas]

Republicans in many states including New Jersey, North Carolina and Texas have taken measures to prevent manufacturers from bypassing dealership networks in order to sell cars to end-users. Tesla is a notable example of a manufacturer impacted by these laws, as it currently does not sell its vehicles through third-party dealers as other car companies do.

What are your views on this policy?

[greenforest32]

Of course. These dealership laws are just rent-seeking corruption.

http://www.wired.com/business/2014/03/car-dealers-fear-teslas-plan-end-oil-changes-forever/

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[Mordecai]

What are your views on this policy?

That it's stupid and shows Republicans to be the corrupt anti-market hacks that they are.

[dead0man]

Of course they should.  I'd be curious to see how any sane person could defend this nonsense.

[DC Al Fine]

Yes with the caveat that they shouldn't if a manufacturer signed a contract agreeing not to do so.

[politicallefty]

Yes (D), of course. I see no reason why anyone shouldn't be able to do this. All car manufacturers should be able to sell directly to consumers. If it comes down to lobbying, I can't see how dealerships should be able to overcome the car manufacturers themselves. Manufacturers can end the racket and I can't see how any of them would be worse off as a result.

I'm aware of the latest news that the Christie Administration has effectively banned Tesla from selling cars in New Jersey. That's some nice hypocrisy from a party that claims to support free market capitalism.

[AggregateDemand]

I believe the reasoning for continuing the dealership arrangement is that local point of service (including repair) has some value added to the market, and states/localities are happy to keep the profits in the home market, rather than seeing them repatriated to corporate HQ.

However, the dealership arrangement seems to have exhausted most of its usefulness, hence the massive retraction during the global credit crisis.

[traininthedistance]

My opinion on this matter is almost too obvious to even bother saying.

It's a pretty big part of my worldview to never dismiss any person or class or people as completely worthless to society... but if any profession can test that principle, the lobbying-for-things-that-suck, uselessly rent-seeking, hard-sell, tacky-macho pollution pushers that are traditional car dealerships come closest.

[Goldwater]

Yes (R). I see absolutely no reason why they shouldn't be able to.

[Deus Naturae]

Yes (member of the actual free-market party).

[ElectionsGuy]

Of course they should.  I'd be curious to see how any sane person could defend this nonsense.

[H. Ross Peron]

Yes with the caveat that they shouldn't if a manufacturer signed a contract agreeing not to do so.

[TDAS04]

Absolutely.

[Linus Van Pelt]

Yes, clearly.

But that aside, does anyone here understand the law and economics of this situation well enough to explain why Tesla can't just set up a "dealership" where they currently have a company-owned store?

[Atlas Has Shrugged]

Of course they should.  I'd be curious to see how any sane person could defend this nonsense.

[TNF]

Yes, and the auto industry should be nationalized and run by the UAW

[Snowstalker Mk. II]

Yes, and the auto industry should be nationalized and run by the UAW

[Indy Texas]

Yes, clearly.

But that aside, does anyone here understand the law and economics of this situation well enough to explain why Tesla can't just set up a "dealership" where they currently have a company-owned store?

When I go to a local Ford or Chevrolet dealership, they have a whole lot full of cars sitting there. If I want to buy a car, I pay money to the dealership (either myself or I get financing from them or from a bank) and then I take delivery of that car, drive it off the lot and that's the end of it.

If I want to buy a Tesla, I can go to a Tesla retail store, but I can't buy a car there. I can look at them. I can test drive them. But if I want to buy one, I have to order it from the company and wait for it to be built and delivered. My transaction is purely with Tesla Motors. The store has no role other than as a showroom. No inventory. No middleman between the manufacturer and the end user.

[Linus Van Pelt]

Whether the company owns the store directly seems like a separate issue from whether the inventory is actually on the premises, though. An independently-owned store can order a specific item from the manufacturer when a consumer requests it; before online shopping, for example, the standard way to get a book that wasn't at your local bookstore was to get the store to order it.

[Wake Me Up When The Hard Border Ends]

Yes (proper free marketeer)

[RogueBeaver]

Yes (proper free marketeer)

[Cory]

Of course they should.  I'd be curious to see how any sane person could defend this nonsense.