CEO of AutoNation, US’ Largest Automotive Retailer, Says He’d Be “Completely Open” to Selling Tesla Vehicles (w/video)

4 years ago by Eric Loveday 7

AutoNation Has Dealership Across the US

AutoNation Has Dealerships Across the US

AutoNation, with its 266 dealerships across the US and 20,000 employees, could someday come to the aid of Tesla Motors if the startup automaker continues to have to battle against the dealership organizations in the US.

Tesla Store Map

Tesla Store Map

AutoNation CEO Mike Jackson told CNBC’s “Squawk Box” that Tesla has a “marvelous product” and that AutoNation would be “completely open” to selling Tesla vehicles.

Quoting Jackson:

“It’s an excellent electric car.  If you take the Fisker, which was a terrible car, the company is now bankrupt. You take Tesla, which is an outstanding car, and the company is really finding its way.”

“Tesla has a direct model at the moment. But when they want to go to higher volumes, I think they’re going to need a different retail model.”

This in no way implies that Tesla would be open to selling its vehicle through AutoNation, but it seems that if Tesla does find itself in a hole (created by those archaic/monopolistic dealership laws), then AutoNation could be there to help out.

Currently, AutoNation sells vehicles from 32 different brands in 15 US states. AutoNation is unmatched in terms of US automotive sales, as there’s simply no other retailer that comes close.  Additionally, AutoNation is huge on using the Internet as a source for sales, much in the same way that Tesla does today.

Source: CNBC

 

Tags: , , , , , ,

7 responses to "CEO of AutoNation, US’ Largest Automotive Retailer, Says He’d Be “Completely Open” to Selling Tesla Vehicles (w/video)"

  1. Roy_H says:

    Big ad for AutoNation.

    Of course. The whole dealer effort to ban Tesla from selling direct is to force Tesla to sell through them so they can get their mark-up! Who wants to pay another 10% to 20% for their Tesla? Let’s see a show of hands.

  2. Chris O says:

    Maybe he is really taunting Elon Musk here playing into his worst fear: a bunch of ICE sales specialists that strong armed themselves between his product and the market telling customers that these EVs are kinda strange and different so why bother with all these great ICE alternatives.

    Let’s hope it doesn’t come to this, people that make decent consumer products should have the right to sell there own products to the public without the forced intervention of a third party that’s likely to look at the new technology as disruptive for their existing business and therefore unwelcome.

  3. David Murray says:

    They seem to misunderstand the “check from the government”.

    1. Josh says:

      Yeah, it is surprising that he doesn’t know the incentives in his own business (well, maybe its not).

      [Most people here know this, but to be clear] The Federal $7500 is a discount on your tax liability. If you don’t pay $7500 a year in federal taxes, you won’t realized the full benefit on your purchase. In that case it is better to lease and let the manufacturer take the $7500.

      He also said $5k from California, which is wrong. It is $2500.

      It kind-of sounds like he is tiptoeing on the normal slander points against EVs. I will presume he has not been able to find a way to make money on them yet, so it is best to squash them.

  4. AutoNation was a winner of the internet auto sales wars back in 2000 when they conceded to offering exclusive regional dealer licenses to the largest auto dealer giants. http://cnnfn.cnn.com/2000/09/20/redherring/herring_auto/
    http://m.wardsauto.com/news-amp-analysis/autonation-website-fights-competition

    From two maps above, one can see that AutoNation is focused on the luxury auto market (cities with highest income earners). The Model S is quickly gaining on the Luxery-Performace sales charts, so is only natural that AutoNation wants a bright new player on their team. Tesla, being a free agent, has no commitments.

    PS: Scaling is something the internet excels at; and it’s open. The connections beyond the Internet are what make the difference in real-life experience.

  5. Anthony says:

    The scaling up problem isn’t much of an issue for Tesla. It is for cars that need oil changes every 3,000-5,000 miles, and have lots of mechanical moving parts, but I don’t expect that there is a lot of maintenance work on a Model S (remember how everyone got huffy about the $600/yr maintenance fee?).

    Think of it this way, you know when a metropolitan area needs another dealership based on the amount of cars they service. When they get overwhelmed with service, its time to add more dealerships. This is because service is a capital intensive requirement – more bays, more tools. Adding a salesman or two is easy compared to making a service area bigger and tooling it up and staffing it up. Even sales volumes can scale fairly easily – a number of car dealers have rented off-site lots where they can store cars and bring them in on a daily or weekly basis.

    A corollary to Musk’s view that traditional dealers are bad for EVs because is that when Tesla EVs can get by with a fraction of the amount of service a gasoline car requires, the need for the number of dealerships per town decreases dramatically. When there is only one dealer in town that sells Tesla models, you’re stuck paying whatever price they say you will pay. And at that point you might as well just go direct to the source – you’re stuck paying Tesla’s price without the middleman markup.

    1. MTN Ranger says:

      Tesla is also probably saving a lot of money on their service centers. One just opened near me in a non-descript industrial/commercial space near the airport. Compare that to expensive auto dealer lots on prime real estate.