The law remains the same, but Tesla may be able to change that.

Tesla Opens Third Gallery in Texas While NADA Fight Back With Ad Campaign

Breaking from decades of car-buying tradition, Tesla Motors sells its cars direct to customers rather than through a third-party franchised dealer. As a consequence, it is the sworn enemy of auto dealers and auto dealer associations across the U.S.

Powerful, wealthy and keen to protect their interests, many auto dealer associations in various states have managed to push through protectionist measures through the legislative process. Designed to stop Tesla from selling direct to customers, legislation in states like Texas and Arizona make it impossible for Tesla to set up mall-based shops where customers can come in and test-drive a car.

Tesla Galleries are like Tesla Showrooms -- but you just can't ask about Teslas in particular...

Tesla Galleries are like Tesla Showrooms — but you just can’t ask about Teslas in particular…

Yet on Friday, Tesla Motors opened a brand-new, 2,200 square-foot location in Dallas, Texas, joining two other Texas-based Tesla Galleries already experiencing a high volume of visitors. While Tesla can’t use its stores to discuss pricing of any Tesla cars, arrange test drives or even offer technical advice for existing owners, it can discuss the technology of electric vehicles in general.

They are, essentially, permanent electric car information and education centres, owned and operated by Tesla Motors but designed to promote electric cars in general, something not prohibited by law.

Tesla’s approach seems to be working, too, with nearly 2,000 Teslas registered to customers within Texas.

As we’ve explained before, those who want to buy a Tesla in a state where direct-to-customer sales are banned don’t have it exactly easy, making those 2,000 Texan Teslas even more special.

In Texas, for example, potential Texas owners have to travel out of state to California to purchase their car, or make an order online and travel out of state to pick it up. They then have to register their car in the state of California on a temporary license, before driving it back to Texas and re-registering it within a ninety-day window.

Autodealer Associations want to kill the Tesla Store and Tesla Showroom, but are they now running scared?

Autodealer Associations want to kill the Tesla Store and Tesla Showroom, but are they now running scared?

Once back in Texas, owners can’t talk directly to a mechanic, and any problems with the car must be direct through Tesla HQ in California. While service centres exist in some form, they are not allowed to display the Tesla logo and cannot advertise that they do Tesla work, service, or warranty repairs.

Yet those 2,000 cars — admittedly in one of the largest states by area in the union — proves that those who really want a Tesla will go to great lengths to buy one. Tesla opening a third gallery proves that those who visit the galleries — while they may be frustrated about not being able to find out about a Tesla — are making the trip to find out electric cars in general. And if we had to guess, they’re visiting the low-pressure, no hard-sell environment of a Tesla gallery in preference to the traditional hard sell world of car dealerships.

The whole thing has auto dealers scared and playing defensively to the point that the National Auto Dealers Association has just launched an entire pro-dealer ad campaign designed to scare consumers away from Tesla and its business model. The website, called “Get The Facts,” even has its own animated film short to try and push the message home.

Who’s winning? The Californian automaker technically banned from selling direct to customers in a state with nearly 2,000 registered users and a third, recently-opened gallery — or the powerful auto dealer association spending millions of dollars on lobbying efforts and animated ad campaigns?

You decide — and leave your thoughts in the Comments below.


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  • Matt Beard

    I still think if banning non-dealer car sales is justified, so is banning non-dealer computer sales, non-dealer phone sales etc.

  • Surya

    I agree with MattnI also think the ad is disingenuous. The people working for the dealer would now work for the dealer owned by the manufacturer. The taxes payed by the dealers would now be payed by the manufacturer. Weather a manufacturer pays a dealer for dealing with a recall or carries that cost itself makes no difference. They will never do a recall just because it’s fun to do.nAnd no, dealers will not compete on price, just like Apple stores don’t compete on price. No, manufacturers will compete on price, just like they do now. There will still be incentives from manufacturers and manufacturer owned dealers to compel a customer to buy their car. For the customer very little will change, except maybe that the whole experience will improve.nAnd why ban manufacturers from selling direct? If all the facts in the video are true, they can’t compete with dealers anyway, as those are more competitive. So what’s the problem?

  • D. Harrower

    Good to see Tesla opening up more locations!nnThough, coming from a place many times the size of Texas, yet with only TWO stores (Canada), I can’t help but wish Tesla would focus more effort on under-served places where they CAN sell the car…rather than opening yet another “gallery”.

  • esl1999

    Don’t you worry your pretty little head over all them complicated paper work, Darling.nWill keep you safe from them mean manufacturers.nTexas and NADA have one thing in common… Bull.

    • For just a tiny, squeeny second, I looked at this reply and thought… “What the heeeccckkk?”nnnThen I saw what you did… and I laughed heartily 😉

  • Drucifer

    They left one thing off the cartoon: “I’m Rick Perry and I approve this message”

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