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Guess the quote

Posted on March 20th, 2014 at 8:16 by John Sinteur in category: News -- Write a comment

This is from:

A) The Sopranos
B) The Godfather III
C) A New Jersey car dealer

[Quote]:

“This Musk guy, he wants all the profits for himself,” says Tom Dougherty, a 25-year veteran of the business.

[..]

“They wanted to go direct, which means no sales force. That’s cutting out a lot of people. No way that’s gonna fly.”

  1. That “less recurring revenue to the dealership” line is crap. They would love to just sell you the car and move on. ALL automakers would sell direct if they could get away with it. Dealers are a nuisance to them. Further, most dealerships would do away with parts and service departments if they could get away with it. Parts and service are a nuisance to them. Consumers used to buy cars direct. Dealers sprang up to help consumers get the cars off of the trains, remove the various transport blocks and nails, and show people how to safely crank their engines. They have evolved from that. Dealers, laws, and franchise agreements between automakers and their dealership networks arose to protect consumers from people like that Tesla clown. I know those vehicles will never, ever break but imagine the one time one of them does and the closest qualified repair facility is 800 miles away.

  2. It’s a cartel.

  3. I’m not an expert on car sales or anything remotely close to it but I am a Musk fan so perhaps it’s worth putting some of Musk’s own words here. These excerpts are from the Tesla Motors Blog.

    “The intent (of the currently existing law) was simply to prevent a fair and longstanding deal between an existing auto company and its dealers from being broken, not to prevent a new company that has no franchisees from selling directly to consumers.”

    “The evidence is clear: when has an American startup auto company ever succeeded by selling through auto dealers? … there have been dozens of failures, Tucker and DeLorean being simply the most well-known. In recent years, electric car startups, such as Fisker, Coda, and many others, attempted to use auto dealers and all failed.”

    “An even bigger conflict of interest with auto dealers is that they make most of their profit from service, but electric cars require much less service than gasoline cars. There are no oil, spark plug or fuel filter changes, no tune-ups and no smog checks needed for an electric car.”
    end quote
    If people want to say that dealerships are worth having, with many benefits, then more power to them say I, but I don’t see a problem with people buying cars direct as long as they’re aware of the alternatives.

  4. “An even bigger conflict of interest with auto dealers is that they make most of their profit from service, but electric cars require much less service than gasoline cars. There are no oil, spark plug or fuel filter changes, no tune-ups and no smog checks needed for an electric car.”

    Call your local dealer, Kharkov, and ask them how much they charge to perform a “smog check”. I don’t doubt that there may be such a thing but I do doubt it’s a significant revenue stream. According to the quote, electric cars “require much less service”. Maybe so but who is going to provide the service they do require? A lot of the service dealerships perform are the services that independent repair shops can’t perform or don’t want to perform. Who is going to repair them when they’re in a collision?

    If they’re going to make stupid statements, they need to be challenged. This isn’t a guy who just wants to cut out the middle man. He wants to cut out the responsibilities that the other OEMs, his competition, are saddled with.

  5. @rob
    Again, not an expert – I’m in the PRC so I don’t even have a car. But perhaps the 2 most significant things are A: the history of electric cars failing when sold through dealerships & B: Consumers having the freedom to buy directly from the manufacturer, so long as they’re aware & fully informed.

  6. A) Millions of cars are sold each year through dealerships. Electric car manufacturer’s are not failing because of them. They’re failing because OEMs can’t get a reliable product to market for a price people are willing to pay even though there is most definitely a market for the first OEM who can do that. No one is happy about the price of gasoline or the damage the fossil fuel industries exact on the environment. People want to go green. B) Consumers can still do that if they want. It’s not convenient or practical but if service on those vehicles is not going to be convenient or practical then sales needn’t be, either.

    I’m all for electric cars but not until they have some infrastructure in place to make them at least a little practical. It doesn’t necessarily have to be dealerships but they have to have a presence reasonably near the point of sale. It’s not like you can pack it up and ship it off to a repair facility like you would a mobile phone or food processor.

  7. If the cars need service, call the Maytag repairman.

  8. There are a lot of electric vehicles around here: golf carts, wheelchairs, mobility scooters (4 wheels), 2-wheel scooters and bicycles. My neighbour’s family has three electric scooters.

    Maintenance isn’t a problem at all. Remembering to plug the thing in does seem to be :-)

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