What Almost Brought Elon Musk To Tears In His Shareholder Meeting?

Illustration for article titled What Almost Brought Elon Musk To Tears In His Shareholder Meeting?

Tesla Motors has given us plenty of reasons to be critical over the years, but sensible people can see that they're in the right when it comes to their ongoing fight with car dealers. At least so far, however, it seems to be a losing battle, and this video shows just how much it's getting to CEO Elon Musk.


At the company's shareholder meeting on Tuesday, Musk was asked by one stockholder about the efforts of the National Automobile Dealers Association and state car dealer associations as they try to block Tesla's direct-to-customer sales model. Thanks to their lobbying efforts, most states have laws preventing that from happening.

As we've covered before, dealers are threatened by this idea, even though they can't come up with a good reason for why buyers shouldn't be able to get cars direct from the manufacturer besides their claim that dealers exist to protect consumers, which is downright laughable.


So in his response to the question about the dealer issue — which comes in around the 49 minute mark as Autoblog Green noticed — Musk gets oddly emotional, and appears to almost tear up at certain points.

But why shouldn't he feel frustrated? As he says, customers appear to overwhelmingly support a direct sales model. He's also right to wonder why dealer profits are built almost entirely on service, especially when it seems like nearly everyone has at least one horror story in that department.


Musk says that the dealer associations have suggested Tesla get franchises to sell their cars. But when has that worked for small startup automakers, he asks? It didn't work for Fisker, and it didn't work for Coda. It hasn't worked at all in the last 90 years or so, he claims. What is Tesla supposed to do here?


Plus, while people support the direct model, the state legislatures aren't doing anything to enable it, even in supposedly pro-business, pro-free market states like Texas. And North Carolina is pushing legislation that would make it illegal for Tesla to bypass the dealerships.


So clearly, Tesla is stuck in a lose-lose situation. One of the most crucial components to being a successful carmaker is selling cars (duh), and it seems like the establishment keeps on finding ways to prevent them from doing that.

It's understandable that Musk is emotional here. Even when it brings out his Nixonian tendencies, Musk is more than just a CEO — he's a passionate defender of his company and his product, and he deeply wants to see it succeed.


I'm hoping that state legislatures will wise up and change the laws. Tesla deserves a fair shot, and consumers deserve to buy cars however they want.


Despite what the dealers say, I have a weird feeling that the world won't end if a car company figures out a way to cut out the middleman.

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The benefit to a dealership model for car sales is that I can travel to 1 of 4-5 Chevrolet/Ford/Chrysler/Jeep/etc dealerships within a 30-40 mile radius & can haggle the best deal for what I'm willing to spend.

Tesla's sales model gives you a one-price deal... how would you negotiate a better price?