North Carolina’s Ridiculous Tesla Ban

Question for sales people with luxury car dealers (BMW, Mercedes, Lexus, Audi, etc.): what is the average dealer mark up for a mid-size luxury car such as a BMW 5 series, Mercedes E Class, Lexus GS or Audi A6? In other words if a BMW 535i base price is $53,400 MSRP, how much of that goes to the dealer assuming no rebates, factory incentives, etc.

By shipping direct to consumers, Tesla is either passing on the savings to buyers and/or keeping the savings to make extra profits for Tesla.

Tesla made average revenue of $100,816 on each Model S sold in the first quarter of this year ($494 million divided by 4,900 cars). Tesla reported first quarter revenue of $562 million (68 million or 12% of Tesla's revenue came from selling its zero-emission vehicle credits to other automakers) and sales of 4,900 cars.

As I showed in the other blog, the Tesla Model s is essentially a mid-sized luxury car like an Audi A6 (first two 60/85 kWh variants of the Tesla Model S) or Audi S6 (the Performance variant of the Model S). Yet Tesla is selling these cars at prices at the level of the large-sized German luxury cars like the Audi A8, BMW 7 Series, Mercedes S Class. It's like buying an Audi A8 full MSRP, I guess. The cost of the battery and car equipment does not justify the huge price gap.
http://www.teslamotors.com/en_CA/models/options

No wonder Tesla is already profitable. Rich people are motivated to buy these cars because they are getting huge tax credits of $7,500 to $15,000 -- and also because buying an electric car is like buying a gas car and getting a huge gas rebate card (that saves you another $10,000 to $15,000 on gas costs and time).

The price of the Tesla Model S has -- inexplicably -- increased by a few thousand dollars over the past six months. Is Tesla price gouging once it became clear there was demand for its car?

Since Tesla is cutting out dealers -- and the benefit of the dealer's profits and staff commissions being injected into the local economy (i.e., jobs in the local economy are being screwed) -- then the profitable Tesla should do the right thing: give back the cost savings to the consumers in the local economy instead of lining the pockets of the company's management and biggest shareholders.

I think it is a combination of the two, buyers safe and Tesla gets to stay in business. There are far more benefits than that however. All of their stores have no salespeople and nobody make a commission off of you buying a car. The customer service here is outstanding, and the people at these stores are focused more on education than the traditional hard sell. You also have the ability to customize every detail of your car (like buying a PC online) instead of having to deal primarily with existing inventory.

After you go through the process of buying a Tesla, you will never, ever, want to buy a car the old way again.

The automotive dealers in this state fear that if Tesla is allowed to sell directly to customers, there is nothing stopping all of the other manufacturers from selling directly to consumers and undercutting the local dealerships.

Also, if you're paying full MSRP + dealer markup on non-specialty vehicles, you're not doing it right. Always negotiate from the dealer's invoice price minus any incentives given to the dealer from the manufacturer. Note: if you live in a small market, you maybe screwed. Look to another larger market.

If I lived in North Carolina and wanted to buy a Tesla I'd simply go out of state. This is similar to what I have to do presently whenever I need a part for something (due to work relocation, I live in a small southern town). As Satriani1 said above: "...Tesla should do the right thing: give back the cost savings to the consumers in the local economy instead of lining the pockets of the company's management and biggest shareholders." So the people who actually OWN Tesla should not be making any money??? Why are they (or anyone else) in business? What he actually means that consumers should line the pockets of dealers.

What a sad state of affair when a politician is clearly protecting the interest of an industry group over its own citizens. What a bunch of malarkey the car dealers are putting up to protect their exclusivity to selling cars.

North Carolina has made social and political strides since....well....the 1950's. But lets just keep in mind, it IS still a southern state. They tend to do things sloooow and at times, backwards.