
Tesla will close most of its stores and only sell cars online - ceejayoz
https://www.theverge.com/2019/2/28/18245296/tesla-stores-closing-online-only-car-sales
======
NeedMoreTea
> a test drive prior to purchase isn’t needed. You can now return a car within
> 7 days or 1,000 miles for a full refund

Call me old fashioned, but that is in no way a better alternative to a test
drive prior to commitment.

~~~
ocdtrekkie
Indeed: Usually I make test drives when deciding which car to buy, not to
ensure my choice was the right one. When people can't test drive a Tesla, they
aren't going to go "well, I can always return it". They're going to buy the
best car they test drive.

While helping someone pick a car recently, we test drove two different models
of car from the same company multiple times as well, to decide which one was
the right one. It's not like Tesla's going to send out a Model 3, a Model S,
and a Model X and let me try all three.

~~~
gregmac
> It's not like Tesla's going to send out a Model 3, a Model S, and a Model X
> and let me try all three.

You're trying to optimize for buying the cheapest Tesla that will work for
you. Tesla is trying to optimize for making the most money they can from you.
If you can not only afford a Model X but are seriously considering it, why
would they put effort into possibly selling you a Model 3?

~~~
leereeves
Because the Model 3 isn't your only cheaper alternative to the Model X.

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ocdtrekkie
The incredible irony here, is that they could, you know, let other businesses
operate the stores. They're called "dealerships".

Amazing when Silicon Valley discovers other businesses do things for a reason.

~~~
ceejayoz
I'd vastly prefer buying a car at a fixed price online than go to a
dealership.

~~~
tappaseater
Having just purchased a Model 3 in December, I second this wholeheartedly. It
was the best buying experience I've ever had.

~~~
godzillabrennus
Maybe switch the dealerships to rental outlets? Kind of like silvercar?

If I rent a Tesla then within 1 year of the rental I buy one then Tesla
discounts my purchase the cost of a day of the rental.

It’d be a great strategy and cover the costs of the dealer network.

~~~
Zanni
That's a great idea. Hell, I just want to be able to rent a Tesla whenever I
travel out of town.

------
thaumaturgy
The Tesla Return Policy is detailed here:
[https://www.tesla.com/support/tesla-return-
policy?redirect=n...](https://www.tesla.com/support/tesla-return-
policy?redirect=no)

Notably:

> _We will accept your vehicle for return if the vehicle: Has an odometer
> mileage of less than 500 miles at the time of return;_

> _...Is in new condition, without damage or abnormal wear and tear..._

> _To return the vehicle, you will need to deliver the vehicle (including all
> original equipment and any parts and accessories that came with the vehicle,
> including the mobile connector kit) to us at a Tesla Sales or Delivery
> Location (or other location that we agree to), and complete a vehicle
> inspection..._

...but these terms describe a 1-day process for test-driven vehicles and 3-day
process for not-test-driven vehicles, so it looks like they haven't updated
the page yet with their new return policy.

Regardless, it looks like they're planning to just eat any costs from returned
vehicles. They're probably gambling that the people serious enough to complete
a purchase for one of their cars aren't likely to return it full of grease
stains, french fry smell, and 900 miles later.

~~~
2sk21
That _is_ very generous but usually when people buy cars, they need to sell
their old car, especially true now that people are rolling over loans from old
cars into new cars.

So lets suppose, you sold or traded in your old car and then bought a Tesla
that it turns out that you don't like. What will you do then?

~~~
kristopolous
I'm pretty sure third party licensed sales operations will pop up.

It's a classic silicon valley style move on their part: get out of the games
you don't want to be in. In this case, the business of car dealerships not
being the same as the business of car manufacturing.

Besides, the long play of Tesla is likely not in Tesla branded cars at all.
They are slowly making the IBM move where they own and license the tech that
other companies rely on.

The legal responsibility of autonomous vehicles and the long term warranty
responsibilities of batteries as they decrease in capacity sounds like a
terrible business to be in.

A, say, Ford "with Tesla tech" is likely worth substantially more in the mind
of the consumer then one without. Pushing off the responsibility of the first
point of contact is invaluable for a scaled business.

The bigger market than your own line of cars is to make the parts that all
cars use.

It's the best powerplay they have access to in the market position they've
formed.

------
TimTheTinker
This move seems a little short-sighted and perhaps reactionary. I think
Tesla’s stores are (or ought to try to be) more like Apple’s retail stores
than high-end car dealerships.

There’s a certain caché that having a brick-and-mortar retail presence adds to
a luxury brand, that wouldn’t be possible otherwise. It gives people,
especially prospective customers, something physical to connect with when
dealing with the company, and it stands as a marketing piece on its own. For
many people, an Apple retail store communicates Apple’s ethos and vision far
better than their website does.

------
post_break
Makes me think of Rich Rebuilds on YouTube and his saga of trying to buy a
Tesla online. Total nightmare.

~~~
goshx
A _used_ Tesla. While it was indeed a nightmare that I hope Tesla figures out
a way to solve, it's not quite the same as if he bought a new vehicle.

~~~
sschueller
He purchased it from Tesla. Why should the experience be any different than
buying a new car?

~~~
rcMgD2BwE72F
Ask anyone who ordered a new Tesla online, or visit
[https://teslamotorsclub.com/tmc/forums/](https://teslamotorsclub.com/tmc/forums/)
if you don't know anyone who did. There are plenty of detailed stories, almost
of of them are extremely positive even though people with bad experiences
usually complain more and louder than others.

------
xenonite
Has someone an idea how the 7 day full refund policy will work out? Something
like “only if all seat plastic covers were kept on”, or is there gonnna be a
refurbished market? However there is usually a high decrease in value on
“unsealing”, so this needs to be accounted for in the original price.
Nonetheless it allows to effectively increase the KPI “number of cars sold”.

~~~
dawnerd
Most definitely sell them as used. Their used section on their site almost
never has cars for very long.

------
zaroth
In my obviously very biased opinion as a TM3 owner, I am both happy and sad
for this news.

The Tesla store in the mall near my house is fun. My kids love going there and
sitting in the different models, and my son knows how to trigger all the
Easter eggs, like making the X falcon doors dance.

At the same time, I have zero use for the store now that I’m an owner, and I
had zero use for the store in actually making my purchase. The test drive that
I did finally do of the TM3 (after I had already put $3,500 down and was
entirely certain I would be buying the car) was actually underwhelming because
I didn’t get nearly enough time with the car to really appreciate it, nor get
to drive it in any kind of interesting terrain.

Actually driving my own TM3 on the other hand blew me away from nearly the
first moment and still does.

I wonder how many owners are like me in that with the massive quantity of
YouTube videos and reviews, already knew with certainty a TM3 would be their
next car without actually needing to drive it? BTW, I’ve never had that with
another car, and never would have dreamed of buying a car without driving it,
before Tesla.

At the TM3 base-range $35k starting price, I think the vast, vast majority of
people who “trial” one will keep it. This is particularly true if you’ve
already made any kind of actual arrangement to charge it at a decent kW rate.

I would add that they need to have a trial mode of the full auto-pilot
functionality, and also perhaps the ability to pay monthly for auto-pilot
software subscription rather than bumping up the sticker price. This would
also help with reducing sales tax and excise taxes I think.

I just hope the car-buying public is ready for this. Tesla will rely heavily,
extremely heavily on word of mouth without a way for people to easily get in
and touch and test drive a model with no commitment. Luckily I give test
drives to everyone I know who I can talk into it, and I’m guessing most owners
act the same in an effort to evangelize.

But as they try to go more mass market and compete with the Accords and
Camrys, as they have less of the evangelical early adopters, will that target
market a) have the charging infrastructure readily available, and b) really be
willing to buy purely online and sight unseen?

I want this to work, and fear that it won’t. They are pushing so damn hard to
get to that $35k price point with any kind of margin left over. If they had
another year of process improvements maybe they could do it even with the
stores. Without a store they can pull forward a profitable $35k TM3 several
months at least. So it makes perfect sense while still being a huge gamble.
Wild ride.

~~~
londons_explore
There will be significant costs to closing the stores though. Many of them
will take a big lifetime loss, because they haven't yet been active long
enough to pay off the startup costs.

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taurath
I'd guess this is a reaction to the huge backlog of orders - if that backlog
starts to really go away, maybe a few showrooms or service centers open back
up.

~~~
londons_explore
Store fit-out is expensive, as is hiring, retaining and training staff.

I doubt they would plan to yo-yo the stores closed and open again.

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rossdavidh
I like much of what Elon Musk is doing, and want this to work, but...

It reminds me of when he decided, "we can make a factory with so much
automation that we don't need all that room for human workers...oh, sh*t, we
can't produce enough, I guess I need to make second factory space with more
room, so that we can have human workers involved more."

