One year ago, Tesla began operating in New Jersey, making for what some can say was a pleasurable car-buying experience.
A typical Tesla experience would bring you into a mall store similar to this.
An interested buyer could walk into one of the Tesla stores, which are typically located within malls (not surrounded by lots full of cars), set up a test drive, and then order the Tesla online directly from the company. This method eliminates much of the headache of dealing with car dealerships.
However, New Jersey law requires car sales to occur through a car dealer. According to Bloomberg, “This administration does not find it appropriate to unilaterally change the way cars are sold in New Jersey without legislation and Tesla has been aware of this position since the beginning,” said Governor Chris Christie spokesman Kevin Roberts.
New Jersey isn’t the only state trying to protect automobile dealers. Tesla is battling dealers across the country in states such as Ohio, New York, Minnesota, and Georgia.
Tesla representatives are already in talks with New Jersey lawmakers about amending the state law. Last year, CEO Elon Musk was reported stating that “the auto dealers association is definitely creating some problems for us, making it harder to get things done” when referring to his direct-sales method.
A typical car dealership looks something like this.
Well, I guess Musk had that right — as of April 1, 2014, the electric-car maker will be banned from selling cars in New Jersey.
Benefits of buying direct
According to a 2009 study by Gerald R. Bodisch, an economist with the U.S. Department of Justice, there are many benefits to buying cars directly from the manufacturer and eliminating the middleman car dealership.
Some of these include greater customer satisfaction, cost-cutting, and eliminating the hassle of a bargaining process.
Until things change, though, we’ll continue to make our way to the dealership.
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