Editorial: Tesla and traditional car dealers should try working together, from St. Louis Post-Dispatch.
Tesla Motors, which manufactures and sells high-end electric cars, is again running into a wall of opposition in Missouri in its efforts to sell the energy-efficient vehicles directly to buyers — no dealerships, no middlemen.
Tesla is among a wave of companies whose business model is inherently disrupting existing industries and existing laws. The automaker’s efforts here are a direct threat to members of the Missouri Automobile Dealers Association.
Tesla product specialist Kat Brand explains the control panel on the electric car at a dealership for the vehicle, Wednesday, Feb. 4, 2015, in Seattle. Washington state’s Senate is still figuring out policy on the electric cars gaining popularity, Tesla among them. Bills discussed in hearings this week would extend the sales/use tax exemption for clean-fuel vehicles and require King/Pierce/Thurston counties to give incentives to builders for adding electric-charging stations to projects. (AP Photo/Elaine Thompson)
The MADA, which dominates the new car sales industry across the state, has members who have spent lots of money to sell the traditional way. The organization says it employed 20,419 employees at 381 locally owned new car and truck dealerships across Missouri in 2013.
The employees of those dealerships earn an average of $50,933 a year, adding up to a $1.4 billion annual payroll, and generating $237 million in local, state and federal taxes. New car and truck sales in 2013 amounted to more than $322 million in revenue for Missouri, according to the MADA.
With that kind of money at stake, MADA has a lot of clout with policymakers. It is using that clout to try to block Tesla from selling its electric cars directly to buyers.
Traditional industries are being challenged by companies like Tesla and Uber, the non-taxi taxi company, and Airbnb, which arranges overnight accommodations, usually in private homes. Their direct-to-the-customer business models eliminate middlemen. But they also eliminate a lot of jobs.
While the state automobile dealers are at war with Tesla, St. Louis cab companies are at war with Uber and Lyft, which call themselves ride-sharing services and use Internet apps instead of dispatchers to pair up riders and drivers. They don’t pay for expensive cab medallions, skirting regulations that govern cab drivers and companies.
