Where is the nearest tesla dealer
5 Reasons Why Tesla Doesn't Use Dealerships
it's been a really tough year for Tesla
Elon Musk called it the worst year in
his career after having to sleep in the
factory working 100-hour weeks to solve
model 3 production issues who was you
that or Tesla died it all paid off
though Tesla reported a record earnings
report in October and it made its third
ever quarterly profit but unlike the
other quarters at 312 million this was a
big profit this marked a turning point
Tesla delivered over fifty six thousand
model series making it the top-selling
sedan in US by revenue by sales volume
it was fifth the model 3 is an amazing
car but another factor driving its
success a direct-to-consumer sales
process unlike other car makers Tesla
doesn't use franchise dealerships and
instead owns and operates all of its
stores here are five reasons why there's
a fundamental problem with dealerships
for Tesla viewers wouldn't benefit from
selling them but Tesla being low volume
in the beginning a dealer would have to
start by selling Tesla's alongside other
brands before opening a dedicated store
this creates a small problem if a
prospect walked into a dealership that
had ten models but only one was electric
it would be like having a vegan option
in a steakhouse when selling the
advantages of an electric car you must
under selling else unless a customer
only wanted a Tesla it would make no
sense for a salesperson to explain the
benefits if it had to undermine its nine
other models inventory a second problem
is that dealers make most of the profits
from service and electric cars require a
lot less maintenance Plus Tesla enables
its cars to be updated over the air when
model 3 launched there was a problem
with its ABS system affecting braking
performance but is simple over-the-air
update fixed it if that were any other
car the manufacturer would have to
recall all the vehicles and pay the
dealer to fix them and human labor is
not cheap
since dealers are owned and operated by
a third party the manufacturer has
little control over who's in charge and
ultimately the entire experience each
store has a different owner with
different processes on how things like
customers are greeted how test drives
are conducted or how negotiations are
handled each dealer even has its own
unique website by owning all of its
stores Tesla has complete control it
does the hiring the firing and
ultimately every store of all is the
same procedures and there's only one
website dealerships got their dealership
nickname for a reason it's a middleman
that takes us bigger profit as it
possibly can
they're very profitable and the staff
are well paid the car salesperson
averages 48,000 a year in the US the
sales manager averages over a hundred K
a year and the general manager trumps
all of that and of course there's an
owner who gets the biggest cut of all at
Tesla the salespeople get about thirty
to forty K or in the store manager only
about 70 K since Tesla owns its stores
there's no middleman taking profit thus
giving it an extra cost advantage over
the competition Tesla believes that
everyone who buys their car should pay
the same price even if you're an
employee
there's known let me ask my manager
price or only for today price it's one
price when you go to the website what
you see is what you get for other cars
getting a final prices and very easy you
have to negotiate or call multiple
dealerships and get multiple quotes in
fact it's so difficult that a company
called true car was formed which is
basically just another middleman to help
people get final price of a car it's
kind of silly the last reason is that
Tesla stores don't really compete with
each other ask a Honda dealer who its
number-one competitor is and it will
tell you that it's the next closest
Honda dealership not the Toyota or Ford
dealership across the street shoppers
these days know what they want so
dealers have to compete in order to earn
their business in the end the
salesperson is trained on how to make
deals today rather than on product
explanation at a Tesla store priority
one is educating customers since each
store is owned by Tesla and since
salespeople are paid by hourly it
doesn't really matter what store the
customer buys the car at this alleviates
a lot of the pressure experienced at
dealerships and a lot of customers
appreciate this it's why it's so much
easier to visit a Tesla store versus a
dealer and that's five reasons why Tesla
doesn't use dealerships if you guys
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