Oklahoma’s recently passed bill is set to prohibited non-licensed companies from selling cars. In other words, Tesla, which does not adhere to the prevailing dealership model, will be forced out of the Oklahoman market.
Oklahoma recently passed a relatively idiosyncratic bill that redefines dealers of new motor vehicles. This bill is regarded as the result of lobbying by traditional dealerships to halt direct sales by automakers. Bearing the brunt of the bill’s impact is Tesla.
The bill states that automakers and enterprises alike are not prohibited from selling and leasing vehicles, as all transactions related to vehicles must be done through licensed dealers. At the same time, automakers and automaker-controlled subsidiaries are barred from applying to become dealers.
Worse yet, shipment of newly purchased cars must be done through dealers rather than by customers. Not only must automakers comply with the individual dealership’s sales process, but they must also, “based on safety-related reasons”, provide the relevant customer data to the dealerships. Conversely, dealers need not provide such data to the automaker in accordance with the latter’s request.
Relevant inspections and penalties will fall under the jurisdiction of the Oklahoma MVC, which may at its discretion levy fines or revoke dealership licenses.
For most automakers that wish to provide an online direct sales system and especially for Tesla, this represents a massive hurdle, since Tesla has no franchise dealers, as it has always adopted a direct sales model.
Now that Tesla’s cradle-to-grave production and sales business model has shaken the preexisting, deep-rooted car sales model to its core, many automakers are now following suit and letting car buyers place orders directly, free from the hassle of having to haggle with dealers. However, this phenomenon may cause rebellion amongst dealers, in turn resulting in Oklahoma’s latest bill.
Still, the bill includes a backdoor for the general public. For the next year, the layperson or local enterprises are able to purchase and bring over three new vehicles from other states without the need to go through dealerships. Going over this limit, however, incurs penalties.
At the moment, most buyers of new cars in Taiwan do so through dealers and distributors, with such perks as preferred pricing or gifts, at times. The drawback, however, is that such sales channels can make one vulnerable to worse prices, depending on the salesperson. Do you enjoy the current car buying experience, or do you prefer the simpler experience of online shopping without the trappings of haggling over prices?
(Image: TechNews)