The whole State of Texas vs Tesla game/blackmail, campaign is in full swing. Tesla can’t sell direct in Texas, Texas is trying to work an exchange a deal on allowing Tesla to sell cars direct, in exchange for bringing a battery plant to Texas.
For the most part people have always only known the dealership model in the USA, and especially in Texas where the same dealership company owns multiple car franchises, and can afford to buy cheap land and build what look like separate businesses to give the illusion of competition.
What has become obvious is that most don’t understand the rules of the game. Not the rules of the game of buying a car, for that’s no game, its rigged more than the Vegas Casino tables, I mean the rules of the game of car franchises. Why they exist, where they come from, how comes, for the most part, they are so hopeless, so inefficient and, yes, so expensive.
This Planet Money podcast is well worth listening too. It gives a complete overview of where we are today and how we got there. It asks the question, what other business would you have to visit multiple stores to compare and buy different brands? For everything else, white goods, TV, clothes, you can for the most part visit multiple stores to compare the same brands.
Back last year I wrote how the dealership/franchises work against you, yes YOU in every way, now we have a professional explanation why.
One last thing, often a confusing wrench thrown into the debate about car dealerships is the one of service. Without the dealership, they say there would be no quality, brand approved, servicing facility. This is baloney. In fact, linking the two is one of the most egregious dealership “lies”. If there were no dealerships to lock manufactures into the service plans, there would indeed be multiple options as the manufactures themselves would be able to, and in some respects, have to set-up, license, and certify repair shops. Whether this would be good for consumers isn’t clear, but it is a lie to say there wouldn’t be any.