Tesla’s Mohegan
Sun deal in Connecticut angers
auto dealerships: “They're evading the law!”
For the longest time, Tesla customers in Connecticut (and some other states) could only buy and take delivery of their vehicles by going out of state. But with the EV maker’s recent deal with the Mohegan Indian Tribe to build a showroom at the Mohegan Sun – an entertainment destination located on tribal land – Tesla customers in Connecticut will soon be able to test drive, purchase, and take delivery of their vehicles in the state.
The deal was a huge victory for Tesla, considering that the EV maker has met numerous challenges in Connecticut in the past. Tesla has attempted to launch several initiatives to support its customers in the state over the years, but the company’s efforts have consistently met opposition from organizations like the Connecticut Automotive Retailers Association, representing the state's car dealers.
State law in Connecticut has always required vehicle makers to sell their products through dealerships. New carmakers like Tesla however have a direct sales model, which means they do not sell their vehicles through franchised dealers. This has resulted in companies like Tesla facing opposition when they try to set up shop in certain states like Connecticut. Thankfully, the majority of U.S. states told the dealership associations to go pound sand when they tried to get laws enacted to stop companies like Tesla from selling direct to consumers in the state. But in some of those cases, Tesla had to use lawyers to get the courts to side with Tesla, but side with Tesla they did in most cases.
In Connecticut, Tesla was able to get around these challenges by building its showroom on the Mohegan Tribe’s land. Kevin Lowry, the assistant general manager at the Mohegan Sun, was optimistic about the deal. “I’m extremely excited; Tesla’s brand is one-of-a-kind, and while we align with many Connecticut laws and regulations, by operating on sovereign land we don’t necessarily have to abide by every law and regulation” Lowry said.
Connecticut's Governor Ned Lamont generally seemed supportive of the deal. “I think it’s within Mohegan Sun’s right to do it. They are a sovereign nation,” he said.
But the deal has not been received warmly by Connecticut’s auto dealerships. Bradley Hoffman, the co-chairman of Hoffman Auto Group, explained that the group does not really have an issue with the Mohegan Sun. Its issues lie with Tesla, as the EV maker is “evading” the law.
Hoffman noted that the Hoffman Auto Group does not believe dealerships in the state will be affected as they already sell over 65 types of electric cars in Connecticut, but he is concerned about consumers not having any dealership support. “Also, that is a check-and-balance with the manufacturers themselves,” Hoffman said.
First, let's ask the 4 million Tesla owners if they are concerned about not having "dealer support". They said, "No." Additionally they mentioned that they hate dealerships and new car salesmen, and they like the no hassle way Tesla sells cars. Like all the products on Amazon, Tesla's cars have a fixed price... there is no salesperson trying to get as much money out of you as possible, and no upselling you on products and services you don't need. And it's not like Tesla doesn't have service centers. And since 90% of repairs don't require the car to go up on a lift, Tesla has mobile service vans that come to you, so you don't have to go to the service center. They can even go to your car while you're at work and repair it without you even having to come down to the car. Do Mr. Hoffman's auto dealers offer this? No. And as to the dealers who sell EVs, well, they're not doing so good compared to Tesla, which is why they want Tesla stopped. But even in states where there are no tribal lands and where the state prohibits Tesla from selling their cars, the citizens of those states – like Michigan for example – don't let those laws stop them from buying Teslas. So besides protecting the dealers, these laws really just inconvenience the consumers.
Next, let's examine Mr. Hoffman's second excuse for the existence of dealers... as a check against the auto manufacturers who may try and do evil things. Well first, this is BS because car dealerships and the manufacturers work together to fleece the consumers. How? The manufacturers are careful to manufacture the cars so they won't likely require warranty repairs, but they also make the cars so they will require out-of-warranty repairs, which is where the dealers make the bulk of their profit. And Tesla owners already have someone to advocate for them if Tesla is unresponsive to their complaints: At the Federal level, the National Highway Traffic and Safety Administration (NHTSA), and the Better Business Bureau, and the State Attorney General's office, and social media. But so far, after 10 years of selling EVs, Tesla owners give high marks to Tesla's customer service and tech support. So the real reason automobile dealership associations hate Tesla is because Tesla steals business away from them. Plain and simple. So Mr. Hoffman and his ilk can try and BS the public all they want, people are seeing right through them.
And Tesla has partnered with sovereign Indian nations in other states to get around the auto laws that are actually "restraint of trade" laws when applied to companies like Tesla. These laws were meant to protect auto dealers from auto manufacturers who decided to do an end-run around the dealers and start selling direct to consumers. These laws weren't meant to apply to car makers who don't have dealer networks, but dealer networks are using these laws to stifle Tesla. Another reason to think poorly of auto dealers I guess.
The Mohegan Sun
The interior of the
Mohegan Sun where Tesla's showroom will be located
The Oneida Indian
Nation partnered with Tesla to open the first EV showroom in upstate
New York,
much to the delight of the New York Automobile Dealers Association (kidding).