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U.S. Dealer Group Seeks Tesla Meeting on Retail Plans

The National Automobile Dealers Association, which represents almost 16,000 new-vehicle dealers, said it’s seeking to meet with electric-car maker Tesla Motors Inc. (TSLA) about its retail network plans.

“NADA has serious concerns about Tesla’s intentions,” Chairman William Underriner said yesterday in an e-mailed statement. “We are seeking a meeting with Tesla executives, including its CEO Elon Musk, to discuss these concerns.”

Tesla, the maker of the Model S, is defending its retailing strategy against lawsuits by state auto dealer groups. David Westcott, who was elected this month as chairman of NADA for 2013, said earlier yesterday in an interview that the McLean, Virginia-based group would leave it to states to challenge Tesla based on their respective franchise laws.

Tesla, which is using using a company-owned store and service center strategy, has modeled its showrooms after Apple Inc. (AAPL)’s outlets. George Blankenship, vice president of sales, is a former real estate executive for Cupertino, California-based Apple who designed that company’s retail sites.

The carmaker was sued this month by dealer groups in New York and Massachusetts, which claimed that Tesla’s strategy violates franchise laws. The company’s strategy is needed to properly educate potential customers about its electric cars, Musk said in an Oct. 22 blog post.

“Existing franchise dealers have a fundamental conflict of interest between selling gasoline cars, which constitute the vast majority of their business, and selling the new technology of electric cars,” Musk wrote on Palo Alto, California-based Tesla’s website. “It is impossible for them to explain the advantages of going electric without simultaneously undermining their traditional business.”
State Dependent

Dealers’ concerns with Tesla are “a state-by-state issue depending on specific franchise laws,” Underriner said in the statement.
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