

Tesla messes with Texas over how to sell its electric cars - protomyth
http://gigaom.com/2013/04/10/tesla-messes-with-texas-over-how-to-sell-its-electric-cars/

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daniel_solano
This is the same state where car dealerships are only allowed to be open one
day of either Saturday or Sunday. There was recently a proposal to get rid of
this law, but it failed. Who was one of the biggest proponents of the status
quo? The Texas Automobile Dealers Association.

It's yet another example of where government is used to protect special
interests.

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jlgreco
> _only allowed to be open one day of either Saturday or Sunday._

Hmm, jewish-friendly blue law? I understand (and disagree with) "closed on
sunday" laws, but how did that sort of law come into being?

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danielweber
Because auto-sellers don't want to work both days of the weekend.

Let's say I run a liquor store. I get together and collude with all my liquor
store running buddies and pass a law that says liquor stores can't be open
after 5pm.

Ta-da, we all get to go home at 5pm. We don't lose any sales to people open
after 5pm, because no one is allowed to do that.

And if someone wants alcohol after 5pm, fuck 'em.

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jlgreco
Oh yeah, I get that much. Wondering how they got the "either day, but not
both" part. Usually those laws are just "no sundays".

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cobrausn
More accurate title would be 'Tesla and Elon Musk work with state lawmakers to
enable direct-to-consumer auto sales', but alas, the link bait must flow.

Either way, I hope this works. I would seriously love to see some Teslas on
the road here.

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Flemlord
Actually it's pretty much a Tesla-only bill:

the new bill is pretty narrowly specific for a company like Tesla. [The bill]
permits U.S.-based companies that make 100 percent electric cars (so no
hybrids) to sell directly to customers.

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protomyth
This would be the only reason I would want it voted down / vetoed. If you
enable this for electric, it should be enabled for every other car
manufacturer.

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thezilch
Are you opposed to iteration? Opposed to the bill passing -- believe
dealerships would let it pass? Tesla has to potentially wait orders of
magnitude longer while a battle they don't care about ensues -- dealerships
versus gas-automobile manufacturers?

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protomyth
I'm opposed to treating manufactures of automobiles and the automobiles
themselves[1] differently. So, I guess that means I would want it to apply to
all (since there are other ideas for alternate energy cars) or none.

1) I am still waiting for the equivalent of a "gas tax" on energy used by
electric cars to pay for the roads

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thezilch
Let's be clear that I and likely Musk -- Tesla -- are not opposed to equal
things being equal. I honestly don't know the history and the inner-workings
of why automobile manufacturers are barred from selling their goods directly
to consumers. If I can liken the music/movie/etc industry to the automobile
industry, I can understand why Tesla would not want to wait years, decades,
forever? to stave off dealerships, if they don't have to. In all likelihood,
the gas-automobile manufacturers are just as likely to be OPPOSED to this
bill, if they think it will make Tesla go away and they can continue to get
kickbacks from dealerships.

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protomyth
> Let's be clear that I and likely Musk -- Tesla -- are not opposed to equal
> things being equal.

I hope you're right, but actions are what counts.

As to the rest, I am seriously sick of people using the law as their own
weapon against others. A tax break here, a special rule there, and we as
voters and consumers lose because there are more law on the books than we
need.

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scragg
Why is there a law the prohibits sales of any product directly from the
manufacturer to the customer?

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pc86
Because every car dealership in the country would immediately go out of
business and cars would be a decent percentage cheaper.

Not saying that's a good reason, just pointing out there's a lot of money and
interest in keeping the status quo, as there always is.

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old-gregg
Actually I believe the law does not prohibit the manufacturers to sell
directly to consumers, it requires the seller to be located in Texas. A
subtle, but important difference. I believe the original reasoning for this
was to prevent sales tax avoidance by purchasing cars out of state. This was
pre-Internet.

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vonmoltke
No, they do prevent exactly that. In Texas, car manufacturers are not allowed
to have company stores, only franchisee-run dealerships.

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geon
It always baffles me how The Land Of The Free (TM) has laws that are so
clearly anticompetitive.

Same thing with Uber and the special taxi law, or the city sponsored DSL
monopolies that seems to be the norm in the US.

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rayiner
In the U.S., except for a relatively small stretch around the turn of the 20th
century, freedom has never overlapped much with libertarian economic
"freedom." The whole concept largely post-dates the founding (remember, Adam
Smith was a contemporary of the founding fathers, and his ideas wouldn't turn
into modern free-market principles until much later). I'm sure at some point
it was perceived that it was beneficial for Texas to force sales through Texas
franchises rather than allow out of state car manufacturers to sell directly
to Texas citizens.

The state-affiliated monopolies are a different situation. They exist because
state and local governments wanted something for nothing. They wanted taxi
services to serve poor people and far-flung parts of cities, and they wanted
telecom services to do the same. In a free market, all these service providers
wouldn't do that--they'd focus their efforts only on the most profitable
areas. So the governments reached a bargain: the companies agree to serve
everybody, and in return they get a monopoly. That's why Uber isn't allowed to
"compete" with the local taxi companies--those taxi companies get a monopoly
in exchange for their willingness to venture into the Bronx.

Take a look at airfare. It's dramatically more expensive to fly from Richmond,
VA to Eugene, OR than from New York, NY to San Francisco, CA, even though both
trips are roughly the same distance. But cab fares are uniform (per mile)
throughout a government's service area, as are utility rates usually. How does
this happen?

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wroman
Of course Tesla still looking out for own interests and not attempting to
enable directo-to-consumer for all vehicle types.

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thezilch
Of course, indeed. How many impossible feats do you expect Tesla -- Elon Musk
-- to tackle on behalf of humankind? I can't imagine why you think Musk should
fight for an industry he does not believe in, of course!

~~~
wroman
Everyone involved in the game is selfish; none of this has to do with
altruistic goals.

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eumenides1
What an intersting proposal.

The car dealerships should technically oppose it, because what this creates is
a hole in their monopoly. It's not a big hole, but its enought to drive a car
right through :)

Also, the proposal also creates another monopoly for Tesla. Until there is
another fully electric car maker, Tesla is the only dealership is town. If
Tesla can generate enough sales. Who can take them on in Texus without
offering a fully electric car? If Tesla can't generate sales, then who cares
about electric cars.

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yason
Why can't they establish a dealership company of their own that sells only
Tesla cars? If the dealership company must not be owned by the car maker they
can certainly arrange the owners of the Tesla dealership to be something else.
Am I missing something?

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dsfasfasf
>>Am I missing something?

Yes. Tesla would have to license to other dealers which is what it doesn't
want to do.

