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FTC speaks against ban on direct selling of Tesla

Apr 25 2014, 8:25am CDT | by , in News | Cars & Vehicles

FTC speaks against ban on direct selling of Tesla
Photo Credits: Tesla
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The regulatory body believes that normal competitive process should decide whether one sales model is more efficient than another

The Federal Trade Commission might just have entered as a very valuable ally for Tesla when it comes to direct sellign of its cars. FTC, speaking in favor of the Tesla sales, recently stated that the state bans which have been there in place since a long time on direct selling to consumers "protectionist", supporting the traditional dealership business instead of extending protection to companies from unfair abuses by automakers. In order for the economy to be in a better shape, the normal competitive process should decide whether one sales model is more efficient than another. This should not be based entirely upon some law.

The FTC has also revealed confusion regarding the statement that Tesla's sales are in some way dangerous for the wider industry and according to its view there should only be one thing at risk and that should be the old way of buying cars, which might not be necessary now that customers can skip the sales pitch and do most of their research online. Tesla has stood up for itself and it agrees quite adamently that it is time for the state rules to change but The National Automobile Dealers Association is not excited about this new phenomenon. As opposed to what is being stated here, it believes that without the presence of a middleman, the customers will entirely lose their bargaining power. So far, the criticism by the FTC is not enough and we cant say for sure whether anything would change sooner.

 

source: ftc

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