Tesla new beginning, page-2

Hi all,

There are 3 reasons for direct sales:
(a) low volume (dealers are not interested in low volume and the franchise expense)
(b) low profit margins (a $100k car with say $5K GP and low volume is not very attractive
for a retailer particularly if he has to take a trade-in and maintain a Prestige Showroom
(c) control communication/relationship with the customer (this is very important if the product
has service problems/gremlins because manufacturer employees are more liable to support
the product than sales/service personnel in a multi franchise dealership.

So, in summary, IMO, Tesla realises that it has to maintain close controls on the car
for technical and economic reasons.
If they intended to produce a high volume unit without gremlins and cheaply enough to afford
normal wholesale and retail margins then it would, IMO, opt for the conventional mode
of distribution via franchised dealers. The rest of the Auto world cannot be wrong.

My bet is that Brisbane will have a small schmick CBD shopfront with a spinning bow tie salesman
and 2 demo cars with daily rentals for that puppy dog close.-----prestige on a shoestring budget.

Moorookamick