Chicago Automobile Trade Association

Tesla closing retail stores in favor of online-only

March 8, 2019
Tesla CEO Elon Musk announced Feb. 28 that the company would eliminate many of its retail stores and move to online-only vehicle sales. 
In response to media inquiries on the topic, the National Automobile Dealers Association issued the following response:
"We still believe that the franchised dealer model is by far the best way to sell, distribute and service new vehicles. Go online right now and you’ll see that there is hardly a franchised dealer in the country that isn’t offering online sales and financing through their websites. 
 
"But the reality is the vast majority of consumers want to do some combination of both online and traditional shopping for new vehicles. Those are our customers, and we’re going to continue meeting their expectations and catering to their needs."
In its statement, the NADA said it would not fight Tesla’s online sales.
"Franchised dealers conduct online sales now to the degree allowable by federal and state laws (a number of laws and regulations still require wet signatures for vehicle purchases, and even more so for financing).
"If the question is do we oppose direct sales: The issue there is, and has always been, whether or not direct sales violate state licensing and franchising statutes and consumer-protection laws. That answer will vary based on each state’s law. 
"Nothing in Tesla’s announcement has changed the landscape. In fact, from our perspective nothing material at all has changed as a result of Tesla’s announcement — other than the fact that Tesla will be closing stores and conducting layoffs."
 
 

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