Why? Because they're parasites. The dealer network evolved to solve distribution problems from 100 years ago. It makes zero sense as a business model in the 21st century. "Ripe for disruption", as we'd say in these parts. All they have is inertia, deep political connections, and a century of regulatory mazes. But those are three very big things to have.
Still, they're fighting a defensive war. They will lose. The question is only how quickly, and at what cost to consumers?
Car dealers and independent auto service centers need protection from manufactures; dealers can service brands they don't sell should they choose.
The danger in allowing manufacturers to determine how sales are made is they will likely dictate how repair and maintenance is handled. While maintenance on an electronic vehicle is going to be significantly different my warranty should not be affected should I choose someone other than the manufacturer to repair it.
disclaimer, I work for a leading supplier of auto parts.
Those are two completely separate topics. The fact that dealers now service cars has nothing to do with the fact that they sell them. Otherwise auto repair shops wouldn't exist.
With Tesla, I don't think it is anywhere near as likely as you seem to. Look at this:
Going a step further, I have made it a principle within Tesla that we should never attempt to make servicing a profit center. It does not seem right to me that companies try to make a profit off customers when their product breaks. Overcharging people for unneeded servicing (often not even fixing the original problem) is rampant within the industry and happened to me personally on several occasions when I drove gasoline cars.
Beyond that, with unbelievably fewer moving parts and over-the-air updates, Tesla vehicles require far less servicing. For starters, they don't require regular oil changes.
None of which really needs to touched very often. Brake fluid should be changed once a year or so (yeah, neither do I). Same with the in-cabin filter. The rest is a 100K mile service on the Leaf, IIRC.
This is why Right to Repair laws are so important. https://en.wikipedia.org/wiki/Motor_Vehicle_Owners%27_Right_...
That danger only applies to you if you don't read the contract agreement before signing it.
Since most American legislators come from a legal background, the culture of national politics has this world view. Chinese leadership is majority engineering, so at least they have some sense that physics isn't impressed dollars and poll results.
Not to mention the fact that China seems the be having a massive problem with official corruption. In fact, China's official corruption problem is arguably worse than America's. At least our politicians are bought with campaign dollars. It appears that Chinese politicians and bureaucrats are bought with direct payments.
In short, we should expect the United States to be corrupt because of lawyers and China to be not corrupt because of engineers, and I'm just saying that's the opposite of the truth.
I really don't care all that much, I'm just really curious now why you bothered to mention China at all if what you were trying to say was that the US is worse than we thought.
"In May 2011, all of the equity in Skype was sold to Microsoft for $8.5 billion. Due to eBay's 30% stake at the time of sale, the company realized a net gain of $1.4 billion on its original investment in Skype."
It's simpler than that, though. On a local level, away from the large cities, it's not uncommon for the guy or gal that owns (not necessarily the same as the name is on the sign though) the local dealership to be the area's state senator or state representative. No amount of lobbying or money from tesla, etc, are going to convince him to vote against his/her own business.
The entire dealership system represents a market inefficiency that will correct itself. The only forces that are keeping the monstrosity around are broken political systems and force (physical or otherwise) paramount to coercion.
Consider that among all of the computer OEMs, Apple is the only one who has successfully operated a retail channel. (Gateway did once, but it wasn't very profitable)
Also consider another franchise model: fast food. McDonald's has a vast network of franchise and corporate owned stores. There is no discernable difference in customer experience or cost between the two.
That is one of the reasons that by and large fixed pricing hasn't worked with autos as much as everyone seems to think that it's such a great idea.
Negotiation and "buy now" kicks people off of fences. (So does inventory and other factors to be sure..)
So you are suggesting that Ford is interested in replacing the franchised model and operating and owning the establishments themselves?
Car dealerships in many areas are basically small businesses.
They are a model that work in the same way that many bakeries have route drivers that are one step away from being employees in a sense (Fedex also uses this in some areas).
I don't buy the idea that it's a given that a large existing car manufacturer would rather just build out and operate car dealerships and that there is no value to an entrepreneur owning that dealership. Or that that even adds to significant extra costs for the consumer. By "significant" I mean the extra cost per car because there is a dealer. (Which by the way you do need a place to get service (even with electric) and you do need a showroom and a local point of contact).
How much profit per car do you think the dealer makes exactly that the consumer will save?
(This is not a pro or con for dealers just something that came to my mind based on your comment).
The automobile industry has consumer protection laws that force manufacturers to honor warranties and emission control systems.
I actually have.
So please explain what you are trying to say.
Car dealers solve the risk management function. Selling cars is a risky business. Car makers are in the business of making cars, which is significantly different business activity with a wholly different risk profile and operational needs.
Tesla can sell direct to customers because its small enough now that the localized retail/inventory risks aren't significant. This business model (of manufacturer-owned dealers) simply won't scale to a national level.
This could be said for most middlemen such as Real Estate Agents and Financial Planners.