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(Yahoo)   Texas bans sales of Tesla cars, because Fark you   (news.yahoo.com) divider line 363
    More: Obvious, Texas, Fark, Motor Trend  
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20190 clicks; posted to Main » on 22 Aug 2013 at 12:49 PM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-08-22 05:13:52 PM

serial_crusher: It will be kind of interesting when everybody switches to electric cars though.  We already have rolling blackouts during hot summers when the grid can't keep up with everybody's AC.


AC is used most during the daytime. Electric car charging could be done mostly at night. The cars would actually *help* level off demand. People could conceivably even set up their cars so if demand and thus price is high, they could provide and sell power back into the grid.
 
2013-08-22 05:14:34 PM
I don't know anything about the Tesla, and would never have guessed that Texas had laws that would stop this.  I dug around a bit and found a slightly better article, though I'm still confused.  Next step is to read the Fark thread to see if anyone has a reasonable explanation.  Maybe there isn't one.  It wouldn't be the first time Rick Perry and buddies were paid off for making BS laws.

http://www.statesman.com/news/business/tesla-lobbies-to-sell-its-ele ct ric-cars-directly-t/nXHrY/
 
2013-08-22 05:16:22 PM
waterrockets:
Go price a strut replacement at any manufacturer's dealership you like. Now go price the parts and watch the youtube video to DIY. Still think service is an overhead cost? My Acura dealership exists almost solely to get cars on the road for trumped up maintenance costs.

I just replaced my MDX's rear diff oil for $25 out of pocket (including Acura brand diff oil at $6.50/qt.), in just 15 minutes from unbagging the pump to washing my hands. Dealership price: $170. Acura customers are not so price sensitive, and most will see a $650 maintenance estimate, wince a little, then pull out t ...


Yes, a service dept. is an overhead cost.  I agree that some services are better DIY (not that a Tesla will ever need trans. oil, right?), but you still have to figure in the cost of diagnostic equipment, a service area (bay, garage, whatever), service technicians...

You can still replace your own blinker fluid, if you like.  But it's hard to imagine Tesla will let you replace a malfunctioning battery coolant pump, or service one of their custom-built motors.  They're going to want - actually insist - that you let them handle a certain amount of service.
 
2013-08-22 05:16:22 PM

the money is in the banana stand: dmaestaz: For the record, there is nothing Libertarian about texas, they want big government controlled by the GOP, kinda like California. They want big government controlled by the Dems. Both fight to keep the status quo of keeping the people and companies happy, as long as they contribute to there re-election funds.

Bold statements made about an entire state. I don't want that. I live in Texas. I have plenty of conservative friends and most don't want the government controlling most aspects of their life. Even my liberal friends here would rather the government butt out of their business. While the aspects of life that the government butts out of may be different between the two groups, I can very much assure you that "all of Texas" does not think alike. We are a very big state with an extremely diverse population. Then again, I know that contradicts everything you were ever told of Texas or read here on Fark. Have fun continuing believing everything the media tells you.


If you realized I was talking about Politicians...my bad for not specifying that. I live in Colorado and which I thought was pretty Libertarian leaning until I arrived here, sure they legalized pot, but the politicians didn't do that. The people voted for it. Hell we beat Texas in banning Tesla, because of the Politicians who get money. I could be the most Libertarian person in the world, and it doesn't mean jack crap as long as we have these protectionist politicians taking contributions from the Auto Dealers/Car Manufacturers/Big Oil to maintain the status quo.
 
2013-08-22 05:28:34 PM
It doesn't seem to be affecting sales any, i've seen a few banging around Houston.
 
2013-08-22 05:30:05 PM

JesseL: You say all that, but why exactly does the price of service have to be so deeply obfuscated in the up front price of the product?


That is how retail works for one, and secondly consumers would pitch a fit if they saw the cost of service itemized out correctly. For example, we are in the contract market not retail, but if we go into a bid and say our products will cost $200,000 and the installation costs $10,000 - we will get nickel and dimed on the 10k installation portion to the point where we cannot offer the level of service we should be providing. Alternatively, a tactic employed quite often is to lower your installation or service figure in the bid (or don't charge for it) but instead increase the product cost. A client thinks that paying $210,000 for products or $250,000 for products and not being charged installation is a great deal. We don't charge upfront for design and project management services. That doesn't mean you don't pay for it, it is part of the margin of the product.

To put it bluntly, people don't want to pay for good service, but they expect it. The government and state is the worst about this also. They have pre-negotiated contracts such as the GSA schedule so the price of the product is set in stone. If my product is $20, everyone else who can provide that product will be $20. The only thing that is not pre-negotiated is labor (service). More often than not, they will go with the lowest bid and then biatch that the company did a poor quality job and has a bunch of thugs with tats who can't pass a security check on their payroll. That's what not paying for service gets you. If we itemize service and put a true dollar amount to it, nobody understands it or wants to pay.

Please keep in mind I am not justifying how car dealerships work. I myself find them a little shady, just the general concept of service and value.
 
2013-08-22 05:39:28 PM

capt.hollister: Indeed. Tesla's stated plans are to launch the X model SUV in 2014, followed by the development of a $30k car. Selling the expensive cars is a necessary step on the way to financing a future cheaper model.


upload.wikimedia.org

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upload.wikimedia.org

greiderclan.files.wordpress.com

?
 
2013-08-22 05:39:39 PM

JesseL: You say all that, but why exactly does the price of service have to be so deeply obfuscated in the up front price of the product?


Also, with retail you are paying for convenience. You are paying well over list dollar of the product because the of the overhead the company has as well as the inventory. That cost gets charged back to you. What gets me with car dealerships however is that you pay this mark-up despite custom ordering the vehicle. Our manufacturer sells some of their products online, they couldn't sell the full inventory because of how difficult it would be for someone to correctly order all the parts/pieces, install, and specify it. The fully-assembled units are sold online and our manufacturer sells it for about 10% higher than the list dollar amount of the product. We as a dealer can purchase that product for 70% LESS THAN list price. The reason why we cannot get away with buying it for 70% off list, then marking it back up is because of competition in our market. There are only maybe 7 major manufacturers in our industry, but any given territory might have 20+ dealers. This means that you are barely paying anywhere between 10-20% margin on the product, which is well under list price. If we showed our clients that, they don't think they are getting a good deal, they would want us to make less no matter what that number is. They don't understand the costs of service. I could just be like the manufacturer however and charge you an arm and a leg with little to any competition and maybe give you ok service.

The issue is never as easy as it appears on the surface.
 
2013-08-22 05:46:03 PM
There's Fisker Karma in my neighbourhood. Really, the prettiest sedan I've ever seen.
Yet to see a Tesla here in Texas North.
 
2013-08-22 05:49:28 PM

Kraftwerk Orange: Yes, a service dept. is an overhead cost.  I agree that some services are better DIY (not that a Tesla will ever need trans. oil, right?), but you still have to figure in the cost of diagnostic equipment, a service area (bay, garage, whatever), service technicians....


A service center is always profitable with a successful dealership. Any dealer that's been around a while is making buckets of profit on service. There is of course an up-front cost to build service, but they make a profit on every part installed, and they charge $80-$100/hour for the work, based on standardized job times, not time worked.

So, they pay a good mechanic $20/hour? Then charge me $170 for 10 minutes worth of work to change rear diff oil? That job costs them $3.33 for labor, and probably $5 for parts.

I'm not against anyone profiting from work or products, but don't act like the service department is some sort of charity for the good of the customers, or that the mfgrs are twisting their arms to do that work.
 
2013-08-22 06:17:35 PM
I hate car dealerships. I hate the song and dance routine, and wondering once I've signed on the dotted line if I couldn't have gotten it cheaper. Car dealerships are a holdover from the old barter system and need to be done away with. Just put a price on it like any other store and let me pay for it, stop giving me runarounds and bait-and-switch tactics, stop giving me this:

i1102.photobucket.com
 
2013-08-22 06:43:11 PM
"Someone wants an exception to the franchise laws. If we made an exception for everybody that showed up in the legislature, before long the integrity of the entire franchise system is in peril."

Explain to me farkwad how on Earth this is a BAD thing? I have yet to ever meet a dealer that wasn't out to just fark you over so he could get the commission.
 
2013-08-22 06:44:24 PM

Ninja Otter: serial_crusher: It will be kind of interesting when everybody switches to electric cars though.  We already have rolling blackouts during hot summers when the grid can't keep up with everybody's AC.

AC is used most during the daytime. Electric car charging could be done mostly at night. The cars would actually *help* level off demand. People could conceivably even set up their cars so if demand and thus price is high, they could provide and sell power back into the grid.


Residential A/C use peaks in the evening, and is less efficient on a watts per capita basis than commercial/industrial cooling.

In fact, the grid has to work harder during the afternoons and evenings of the hottest summer days-known as periods of peak demand-than it does at any other time of the year.
 
2013-08-22 06:51:18 PM
Hmmm... so doesn't sound like Republican dominated Texas believes in a free market now does it? If they did, they wouldn't introduce this law. They are using the government to regulate and control the marketplace on what appears to be a completely arbitrary basis. I don't know, sounds like something the would accuse Obama of doing. Why does Texas hate capitalism?

Hypocrites, hypocrites, hypocrites! They don't care about the free market, they just care about getting paid by their farking lobbyist buddies. Fark em.
 
2013-08-22 06:52:23 PM
They make air conditioners now that freeze water into ice during low-demand periods, and dump heat into the ice to provide cooling at any time.

What I like about these machines is that they use water ice as the storage medium.  Totally harmless if anything bad happens.
 
2013-08-22 06:55:31 PM

Barfmaker: So is Tesla saying they'll have dealerships but the dealerships will be owned by Tesla? I guess what I'm axing is, what's the difference between a dealer and a store? And more to the point, if I bought one, where would I take it to get it fixed?


A store can be owned by whoever.  A dealer is essentially a franchise operation.  Back in the day car manufacturers used them to insulate themselves from the risks/hassles of selling to the end users.  Today, well, I dislike them.

As for getting it fixed, you take it back to the store/service station to have them work on it under warranty.

Lapdance: Lowest Model price Cash is 63K! Sorry, I can;t do that. When prices started going over $20K for cars I started getting Itchy. How much money do they think us Average Joe's make anymore these days? I remember when you could get a Base Road Runner for $3000! Just a few years ago I got my 2010 Sonata out the door for under $19K Cash. I'm putting just under 10K miles a year on it and fully expect it to last the 10yrs it has on it's warranty and then some. I got 13yrs out of my '96 Saturn and it was getting ready to Die. This Korean car is Way better than that POS was. In 2020 I'll be pushing 70 myself IF I make it that far. I figure I've bought my last car.


Interesting...  I'll give it a 4/10 though.

JuggleGeek: It wouldn't be the first time Rick Perry and buddies were paid off for making BS laws.


I just want to chime in here that most of these franchise laws are older than I am, so it's more Rick being bribed/lobbied to not mess with them and actually enforce them.

This text is now purple: ?


Let's see, I remember that Lamborghini started out as a tractor company that shifted to luxury/sports cars.  They're still a niche product.
I recognize the 2nd vehicle, but don't remember what it's company details are.  The volkswagon beetle was far from the company's first car.  Ferdinand Porsche, who designed the beetle was a well known designer for high end vehicles and race cars and ended up with serious government support.

Finally, the Ford Motor company spent it's first 5 years producing high end cars like everybody else.

Of the companies that produced 'affordable' cars as their first product, a general condition of there not being a affordable car on the market in the first place is notable.  Today, gasoline cars are the general product, and quite affordable compared to the Tesla vehicles.  It'd be better to look even earlier - these cars were produced in a time when there was already competitive markets for high end vehicles.  Ford started high and worked down, faster than Tesla is, but times have changed substantially.
 
2013-08-22 07:01:27 PM
They put in an electric car charger space at the Kohl's in my town now, too. I wonder how many other retail chargers there are now?
 
2013-08-22 07:08:21 PM

Baby Buzzard: They put in an electric car charger space at the Kohl's in my town now, too. I wonder how many other retail chargers there are now?


http://www.plugshare.com/

Make sure to deselect the residential charger option.
 
2013-08-22 07:10:00 PM

Firethorn: I recognize the 2nd vehicle, but don't remember what it's company details are.


BMW Isetta.
 
2013-08-22 07:11:47 PM

MrSteve007: Baby Buzzard: They put in an electric car charger space at the Kohl's in my town now, too. I wonder how many other retail chargers there are now?

http://www.plugshare.com/

Make sure to deselect the residential charger option.


Thanks! There's a ton more near me than I'd thought, since that was the first one I'd ever noticed before...
 
2013-08-22 07:15:40 PM
 
2013-08-22 07:18:21 PM
Thus the Free Market in Texas.
 
2013-08-22 07:19:17 PM

waterrockets: Kraftwerk Orange: Yes, a service dept. is an overhead cost.  I agree that some services are better DIY (not that a Tesla will ever need trans. oil, right?), but you still have to figure in the cost of diagnostic equipment, a service area (bay, garage, whatever), service technicians....

A service center is always profitable with a successful dealership. Any dealer that's been around a while is making buckets of profit on service. There is of course an up-front cost to build service, but they make a profit on every part installed, and they charge $80-$100/hour for the work, based on standardized job times, not time worked.

So, they pay a good mechanic $20/hour? Then charge me $170 for 10 minutes worth of work to change rear diff oil? That job costs them $3.33 for labor, and probably $5 for parts.

I'm not against anyone profiting from work or products, but don't act like the service department is some sort of charity for the good of the customers, or that the mfgrs are twisting their arms to do that work.


So then what would you expect is reasonable to pay for that work? It cost them $8.33 and parts and labor. Do you only expect then to pay $9 or $10? If it is such an easy procedure, why don't you do it? Why not take it to a mechanic for a lower price and compare numbers? You have to realize that while inflated I must say, that a lot of that service charge is for convenience. During that time, you may be offered a complimentary vehicle while your vehicle is repaired, breakfast or snacks, somewhere located conveniently nearby, you will get emails and/or phone calls when the work is done, your car may be washed after, etc. Many of the times it isn't "just" repairing a part. There is a lot there in terms of cost and overhead that you are paying for and if they itemized that out and let you pick and choose the services you received in order to get the cheapest price, that seems like a great idea - but what you end up with is Ryan Air.
 
2013-08-22 07:46:41 PM

studebaker hoch: What I like about these machines is that they use water ice as the storage medium.  Totally harmless if anything bad happens.


You obviously don't know about the ghost shark...
 
2013-08-22 07:53:46 PM

Firethorn: I recognize the 2nd vehicle, but don't remember what it's company details are.


Its a BMW Isetta.  Not sure what the point is because BMW started off as merger between industrial and aircraft engine makers.  They bought a car company later to move into that market.  Not like their first car was the Isetta.  That was a super economy car that came after WW2.
 
2013-08-22 08:03:50 PM

JuggleGeek: I don't know anything about the Tesla, and would never have guessed that Texas had laws that would stop this.  I dug around a bit and found a slightly better article, though I'm still confused.  Next step is to read the Fark thread to see if anyone has a reasonable explanation.  Maybe there isn't one.  It wouldn't be the first time Rick Perry and buddies were paid off for making BS laws.

http://www.statesman.com/news/business/tesla-lobbies-to-sell-its-ele ct ric-cars-directly-t/nXHrY/


The auto franchise laws have been around forever.  It's not our recent crop of politicos who put them into place.  But they sure do step-and-fetchit to tweak the rules and get the prosecutors involved when their campaign contributors come calling.
 
2013-08-22 08:38:16 PM

spiderpaz: Yet they have a problem with California trying to regulate that any eggs sold in California come from chickens that have minimum dimensions to live in because of interstate commerce, blah blah.  God these people just can't get any more hypocritical or petty.


The problem the (R)s have with this law is that it's going to increase the price of a dozen eggs by about $.56, leading to decreased demand. I'd link to the study that states this, but Fark says the link is unfetchable.  Do a Google search on these keywords: california poultry law cage size loss of business.  The result you want is a PDF at a site whose URL starts with ageconsearch.umn.edu.
 
2013-08-22 08:42:36 PM

Naesen: mcreadyblue: Voiceofreason01: Dr Dreidel: Voiceofreason01: The franchise law is bullshiat legislation that does very little besides screw consumers

For those of us ignorant of such things (and who don't want to search teh googles ourselves), can you 'splain?

// EXplanation > MANsplanation, but whatever you got

car manufacturers are prohibited by law from selling cars directly to the public and you cannot sell cars online. Basically the law only exists to bring extra tax revenue into the State and support dealerships.

Not true.

Used cars can be sold online. Only news cars are forbidden.

Solution: have Elon purchase each car to be sold, then simply re-sell it back to Tesla at 100% purchasing price (thus creating paper trail), BOOM technically used. Next have Tesla post cars on used car search sites (or just make their own friggen' site).
???
Profit!


Brilliant - in theory.  I have a hunch, though, that the IRS would frown on these shenanigans.
 
2013-08-22 08:49:59 PM
Forget cars - has anyone here ever tried to buy a mattress? Seriously, car salesmen are practically models of education & transparency compared to a friggin' mattress store...
 
2013-08-22 09:03:57 PM

Baby Buzzard: MrSteve007: Baby Buzzard: They put in an electric car charger space at the Kohl's in my town now, too. I wonder how many other retail chargers there are now?

http://www.plugshare.com/

Make sure to deselect the residential charger option.

Thanks! There's a ton more near me than I'd thought, since that was the first one I'd ever noticed before...


If you want to see alot, select "Seattle, WA" as your search term. We have hundreds upon hundreds of charge points within only about 2 years. Even a couple dozen "fast" 480v chargers along the interstates now too.
 
2013-08-22 09:08:52 PM

the money is in the banana stand: So then what would you expect is reasonable to pay for that work?


Yes, but it's profitable for the dealership. The original claim described it as if the service department was a net loss.
 
2013-08-22 09:16:46 PM

acohn: Brilliant - in theory. I have a hunch, though, that the IRS would frown on these shenanigans.


Why would the IRS care?  Buying and selling at the same price means that there's no net profit, no gain or loss.  No capital gain or loss, and the IRS doesn't care whether the profit you make is from new or 'lightly used' cars.

This is like shenanigans where there's a higher import tariff on cargo vans, so they ship vans built overseas in with windows and seats, then remove them and ship them back to the factory for the next round, mount pre-painted(shipped with the vehicles as 'spare parts') plain metal panels where the windows used to be, and sell them as converted cargo vans, completely legally.

But because it only matters to state law, the IRS doesn't care.
 
2013-08-22 09:23:17 PM

This text is now purple: Ninja Otter: serial_crusher: It will be kind of interesting when everybody switches to electric cars though.  We already have rolling blackouts during hot summers when the grid can't keep up with everybody's AC.

AC is used most during the daytime. Electric car charging could be done mostly at night. The cars would actually *help* level off demand. People could conceivably even set up their cars so if demand and thus price is high, they could provide and sell power back into the grid.

Residential A/C use peaks in the evening, and is less efficient on a watts per capita basis than commercial/industrial cooling.

In fact, the grid has to work harder during the afternoons and evenings of the hottest summer days-known as periods of peak demand-than it does at any other time of the year.


Evening is only a small part of night. Have a button on your charger which, when pressed, delays the start of charging until after midnight.

But from what I've read, power companies have a good plan in place for handling this sort of thing.
1) Develop accurate models of power usage and use to predict demand peaks and dips. Include time of day, weather forecasts (including wind and sunshine, for how much wind and solar power will come in) special events, etc. and it can map demand quite accurately.
2) Determine the cheapest ways to meet the overall level of demand.
3) Use pumped storage and the like to store power during the dips, release it during the peaks. Solar tends to produce most when needed most, so its variability doesn't work against the system.
4) electric vehicles that charge overnight actually help level off demand.

http://www.gizmag.com/uk-national-grid-wind-data/28046/ 
http://www.opb.org/news/blog/ecotrope/report-to-use-more-wind-energy -a dd-electric-cars/ 
http://www.midwestenergynews.com/2011/09/14/how-electric-cars-can-he lp -balance-wind-power/
 
2013-08-22 09:28:28 PM

simplicimus: Uranus Is Huge!: Dinki: Uranus Is Huge!: Maud Dib: Coming on a Bicycle: I'm sure that if the Tesla car somehow becomes really popular in Texas, the situation will right itself automatically.

Not until it comes with 4WD, a lift kit, muddin' tires, and a brush guard.

You forgot Truck Nutz.

And bumpers big enough for "Don't mess with texas" and confederate flag  stickers.

Nah. Except for some pockets of East Texas, there's only one flag that Texans hold dear.

And it ain't the American Flag.

East Texas, it's the Stars and Bars.


You mean West Louisiana? I say let them have everything from Beaumont East.
/Houstonian
 
2013-08-22 09:56:50 PM

UHC2005: simplicimus: Uranus Is Huge!: Dinki: Uranus Is Huge!: Maud Dib: Coming on a Bicycle: I'm sure that if the Tesla car somehow becomes really popular in Texas, the situation will right itself automatically.

Not until it comes with 4WD, a lift kit, muddin' tires, and a brush guard.

You forgot Truck Nutz.

And bumpers big enough for "Don't mess with texas" and confederate flag  stickers.

Nah. Except for some pockets of East Texas, there's only one flag that Texans hold dear.

And it ain't the American Flag.

East Texas, it's the Stars and Bars.

You mean West Louisiana? I say let them have everything from Beaumont East.
/Houstonian


I'm with you. I'm as white as can be be, and even I won't stop in Vidor, much less Orange County. Them folks are scary. When I make my treks to Baton Rouge from Houston, Jennings, La. is my mark of civilization starts here.
 
2013-08-22 10:07:10 PM
At what point do we give Texas back to Mexico and say "no thanks"?
 
2013-08-22 10:38:50 PM

waterrockets: Kraftwerk Orange: Yes, a service dept. is an overhead cost.  I agree that some services are better DIY (not that a Tesla will ever need trans. oil, right?), but you still have to figure in the cost of diagnostic equipment, a service area (bay, garage, whatever), service technicians....

A service center is always profitable with a successful dealership. Any dealer that's been around a while is making buckets of profit on service. There is of course an up-front cost to build service, but they make a profit on every part installed, and they charge $80-$100/hour for the work, based on standardized job times, not time worked.

So, they pay a good mechanic $20/hour? Then charge me $170 for 10 minutes worth of work to change rear diff oil? That job costs them $3.33 for labor, and probably $5 for parts.

I'm not against anyone profiting from work or products, but don't act like the service department is some sort of charity for the good of the customers, or that the mfgrs are twisting their arms to do that work.


I'm not saying it's a charity - I'm saying it's a necessary part of the Dealership model.  Dealers *have* to have a Service Dept., it's part of the conditions of being granted a Dealership license.

Tesla, OTOH, doesn't want to have to have a service department at every location, which is why they're challenging the current Dealership laws.  Tesla wants to cut costs by having a centralized service location that is separate geographically from where they sell the cars, rather than at *every* location that sells their cars.

I could guarantee you that many large franchise groups (like Hendrick here in the Carolinas) would love to be able to centralize their service departments.  As it stands, the same owner has nearly half a dozen different service departs within a mile of each other (one for BMW, one for Volvo, one for GM, one for Dodge, one for Hyundai).    Maybe he could get his service costs down, if he wasn't required to have the overhead cost of five different garages within spitting distance of each other, each with identical equipment and tools, and staffed by guys who don't have a particularly busy day scheduled.

And yes, the manufacturers *do* twist their arms to make sure the Dealers are continually upgrading their tools/equipment, and providing current training for the staff.  Dealers can lose out on high-demand cars if the manufacturer thinks the service isn't up to snuff - so the service dept. is the single part of the Dealership that is continually requiring more investment year after year.  The sales floor?  Whatever, a new coat of paint and some new posters if they're lucky.
 
2013-08-22 10:52:01 PM

Ninja Otter: the money is in the banana stand: So then what would you expect is reasonable to pay for that work?

Yes, but it's profitable for the dealership. The original claim described it as if the service department was a net loss.


I don't think a dealer's service department was ever a net loss.  At one time they had a captive audience.  They insisted that you had to get your oil changed through an authorized dealer or your warranty became invalid.  So instead of $40 at a local shop, it was $150 at the dealer.   Thank goodness that insanity was stopped years ago.  Also, the dealers get compensated by the factory for warranty repairs, including recalls.
 
2013-08-22 11:05:45 PM

UHC2005: You mean West Louisiana? I say let them have everything from Beaumont East.
/Houstonian


Hells no.  Lake Charles and Shreverport/Bossier City think they are more part of Texas anyway.  How about you keep them instead.
 
2013-08-22 11:26:30 PM

This text is now purple: capt.hollister: Indeed. Tesla's stated plans are to launch the X model SUV in 2014, followed by the development of a $30k car. Selling the expensive cars is a necessary step on the way to financing a future cheaper model.

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[upload.wikimedia.org image 640x480]

[upload.wikimedia.org image 582x480]

[greiderclan.files.wordpress.com image 389x269]

?


Lamborghini farm implements are definitely not inexpensive and while Ferruccio Lamborghini was alive the car business was only a personal hobby for getting back at Enzo Ferrari for being such a boor.

The Volkswagen benefited from massive public financing before and during WWII, particularly through massive military orders for Kubelwagens. In fact, the model illustrated is a WWII military type 82E, basically a Kubelwagen with the sedan body.

The inexpensive model T was preceded by the expensive models A through F.  Sort of illustrates my point.

The BMW Isetta is trickier because it did follow on the footsteps of the expensive and slow-selling 501 and 502 models, but really postwar conditions in West Germany were such that it was difficult to survive by making expensive luxury cars. There weren't many people with the money to buy one and those who did still had to face gas rationing.  BMW really only managed to survive those years thanks to its motorcycles. At any rate, BMW did not have to invest in the development of the Isetta rolling chassis because it bought the license from Renzo Rivolta and for an engine it used one of its existing motorcycle engines. BMW also already had production facilities and a distribution and service network. In other words, it did not need a large initial investment to enter into production, so the per-car profit was higher than if it had set itself in business  ab initio with the Isetta.

My point, is that you cannot launch the production of an inexpensive car with its low per-vehicle profit without a massive investment in a production facility with the capacity to turn out enough cars for the whole venture to be profitable. And let's not forget the gigantic investments in publicity and a distribution network necessary to ensure that your new, unknown car by an unknown manufacturer will sell in the necessary numbers to a public that is often wary of new, unproven technology... Elon Musk chose to invest in a more modest production capacity of more-expensive cars that he could sell to affluent early adopters and to use the profits to finance future production facilities for a more mainstream model.
 
2013-08-23 12:01:58 AM

Kraftwerk Orange: waterrockets: Kraftwerk Orange: Yes, a service dept. is an overhead cost.  I agree that some services are better DIY (not that a Tesla will ever need trans. oil, right?), but you still have to figure in the cost of diagnostic equipment, a service area (bay, garage, whatever), service technicians....

A service center is always profitable with a successful dealership. Any dealer that's been around a while is making buckets of profit on service. There is of course an up-front cost to build service, but they make a profit on every part installed, and they charge $80-$100/hour for the work, based on standardized job times, not time worked.

So, they pay a good mechanic $20/hour? Then charge me $170 for 10 minutes worth of work to change rear diff oil? That job costs them $3.33 for labor, and probably $5 for parts.

I'm not against anyone profiting from work or products, but don't act like the service department is some sort of charity for the good of the customers, or that the mfgrs are twisting their arms to do that work.

I'm not saying it's a charity - I'm saying it's a necessary part of the Dealership model.  Dealers *have* to have a Service Dept., it's part of the conditions of being granted a Dealership license.

Tesla, OTOH, doesn't want to have to have a service department at every location, which is why they're challenging the current Dealership laws.  Tesla wants to cut costs by having a centralized service location that is separate geographically from where they sell the cars, rather than at *every* location that sells their cars.

I could guarantee you that many large franchise groups (like Hendrick here in the Carolinas) would love to be able to centralize their service departments.  As it stands, the same owner has nearly half a dozen different service departs within a mile of each other (one for BMW, one for Volvo, one for GM, one for Dodge, one for Hyundai).    Maybe he could get his service costs down, if he wasn't required to have the overhead cost of ...


The service department is a large profit center for a any car dealership. It often generates more profit than the sales department.

Large franchise groups already centralize certain service activities like body shops. A group may have several dealerships, but only one body shop.  Centralized service, however, may not be such a good PR model. I'm pretty sure that their Volvo or (especially) their BMW clients would be very happy with it...

Personally, because of personal experience, I don't like it either.  An established, one-brand dealer is more likely to know the cars they sell. This can be important if you drive anything that isn't mainstream.

When someone broke the passenger side mirror on my car (at the time, an M-B R350), I chose to go to the new dealership that was closest to me. This is a Mercedes-only dealer, but it belongs to a group that owns the Mazda, Honda, and GM dealers all on the same block and "promoted" some of its personnel from those to its new flagship premise. It took me three visits to get the mirror fixed. First they only ordered the outer shell, but realized that both the outer and inner shell were busted. After they received the inner shell and called me back, they realized that the actuating motor was also broken. On another occasion, I went there for some warrantee work. They called me back to tell me that the parts were not covered by M-B's extended warrantee and the fix would be $1300. I told them to put my car back together and return it to me. of course, they charged me for the privilege... Anyhow, I contacted the dealership from where I got the car, a long-established one franchise business.    Not only was the part covered by the warrantee, as I suspected, but if I brought it in that evening they would leave the keys to a courtesy car at the front desk for me. That's the difference between a dealer that knows the cars it sells and one that doesn't.
 
2013-08-23 12:20:01 AM

Saberus Terras: I saw a Tesla just last week in Texas, with a Texas temp paper plate.  So at least one person in Texas managed to get one.  Texas needs to pull their head out of their ass on this, unless they plan on passing some outrageous  registration fees to make up for the fact that Tesla owners will not be paying road taxes through fuel purchases.


I could see them doing that....

/ as an outsider, it looks like most of the politicians in that State are epic-level douchebags...
 
2013-08-23 12:22:44 AM

Firethorn: acohn: Brilliant - in theory. I have a hunch, though, that the IRS would frown on these shenanigans.

Why would the IRS care?  Buying and selling at the same price means that there's no net profit, no gain or loss.  No capital gain or loss, and the IRS doesn't care whether the profit you make is from new or 'lightly used' cars.

This is like shenanigans where there's a higher import tariff on cargo vans, so they ship vans built overseas in with windows and seats, then remove them and ship them back to the factory for the next round, mount pre-painted(shipped with the vehicles as 'spare parts') plain metal panels where the windows used to be, and sell them as converted cargo vans, completely legally.

But because it only matters to state law, the IRS doesn't care.


IANAL, but in the example you cite, the automaker/auto dealer is actually doing something to the vehicle to alter it.  In the hypothetical you posit, no alteration takes place.  Now, if Musk or his delegate drove each of the cars sold he bought 10 miles, then it might technically be a used car, just as it would be if a third party bought it from a Tesla dealership and drove it off the lot.  But since the automobile business has been around a long time, and lobbyists for auto dealerships have been around almost as long, I have a feeling that this kind of legal sleight-of-hand is probably illegal in some provision of every state's laws.
 
2013-08-23 01:13:16 AM

the money is in the banana stand:
So then what would you expect is reasonable to pay for that work? It cost them $8.33 and parts and labor. Do you only expect then to pay $9 or $10? If it is such an easy procedure, why don't you do it? Why not take it to a mechanic for a lower price and compare numbers? You have to realize that while inflated I must say, that a lot of that service charge is for convenience. During that time, you may be offered a complimentary vehicle while your vehicle is repaired, breakfast or snacks, somewhere located conveniently nearby, you will get emails and/or phone calls when the work is done, your car may be washed after, etc. Many of the times it isn't "just" repairing a part. There is a lot there in terms of cost and overhead that you are paying for and if they itemized that out and let you pick and choose the services you received in order to get the cheapest price, that seems like a great idea - but what you end up with is Ryan Air.

This is all irrelevant to my point that dealer service is a profitable business, in general. That said, I did do the work myself...

Kraftwerk Orange: I'm not saying it's a charity - I'm saying it's a necessary part of the Dealership model.  Dealers *have* to have a Service Dept., it's part of the conditions of being granted a Dealership license.

Tesla, OTOH, doesn't want to have to have a service department at every location, which is why they're challenging the current Dealership laws.  Tesla wants to cut costs by having a centralized service location that is separate geographically from where they sell the cars, rather than at *every* location that sells their cars.

I could guarantee you that many large franchise groups (like Hendrick here in the Carolinas) would love to be able to centralize their service departments.  As it stands, the same owner has nearly half a dozen different service departs within a mile of each other (one for BMW, one for Volvo, one for GM, one for Dodge, one for Hyundai).    Maybe he could get his service costs down, if he wasn't required to have the overhead cost of ...


None of this is counter to my assertion that dealer service is profitable. Mandated or not, it makes money. Could it be more profitable if it was centralized? Maybe. Not needed for profitability though.
 
2013-08-23 01:33:00 AM
Anyone who lives in Texas and votes for an incumbent is an idiot.
 
2013-08-23 02:02:41 AM

MerelyFoolish: Anyone who lives in Texas and votes for an incumbent is an idiot.


FTFY
 
2013-08-23 03:48:59 AM

gilgigamesh: Therion: "If we made an exception for everybody that showed up in the legislature, before long the integrity of the entire franchise system is in peril."

The Invisible Hand of the Free Market is making jack-off motions behind your back.

Once again, an example of small government conservatism staying true to their ideals!


And if the federal court overrules them, they'll call that action "big government," because it's a "state's rights issue."
 
2013-08-23 06:06:34 AM

JuggleGeek: I don't know anything about the Tesla, and would never have guessed that Texas had laws that would stop this.  I dug around a bit and found a slightly better article, though I'm still confused.  Next step is to read the Fark thread to see if anyone has a reasonable explanation.  Maybe there isn't one.  It wouldn't be the first time Rick Perry and buddies were paid off for making BS laws.

http://www.statesman.com/news/business/tesla-lobbies-to-sell-its-ele ct ric-cars-directly-t/nXHrY/


I suspect it's not just the Tesla...the auto dealer lobby would stop ANY manufacturer from bypassing them.
 
2013-08-23 07:32:54 AM
who gives a shiat?
it's a tesla
blah blah blah texas
 
2013-08-23 09:06:18 AM

dragonfire77: Build capacitance into the grid. Seems to be the best technical solution for the blackout issue.


No, you don't want to add "capacitance." That would be rather bad for an AC system. You just need storage, which can be implemented at any level at any scale you care to do.


PerilousApricot: Flywheels? No, same problem. You can only make them so big and so fast before the centripetal force pulls them apart.


Flywheels are actually very good for this: They are relatively cheap and fast to react.

gigaom2.files.wordpress.com

Each one of those blue things is a cap to a flywheel containment bunker and contains one of these:

news.heartland.org

Each flywheel stores 25kWh of energy and can deliver that energy at a rate of 100kW. It's actually a pretty good system for stability regulation - just not for bulk storage.
=Smidge=
 
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