Much ado about Tesla's American-made cars
While the U.S. manufacturing sector struggles to get back on track after losing millions of jobs in the last decade, there is one success story that keeps popping up in the news.
American-made Tesla cars have been the talk of the media for the last few months…with good reason.
It wasn’t so long ago when the company was widely considered to be struggling. But last month, Tesla reported the first quarterly profit in its decade-long existence, and the media narrative changed quickly.
Last week, Tesla re-paid, in full, the loan it received through the Department of Energy. The company forked over $456 million…nine years early.
Yet despite its success and diligence in re-paying its loans, Tesla is not feeling welcome everywhere just yet.
A number of states have taken action against Tesla. The point of contention seems to be the company’s sales model: it sells cars directly to the consumer without a middle-man style dealership.
To the average set of ears this may not seem like a big problem, however it’s not average folks who are spearheading the campaigns to stop Tesla. Mostly, it’s coming from the automobile dealers’ lobbies.
In Texas, lawmakers chose not to hear a bill that would have changed the state’s existing mandate that consumers must buy cars from dealers. In North Carolina, the state government is considering a ban on Tesla entirely.
Writing for Slate, Will Oremus points out some of the controversy:
The bill is being pushed by the North Carolina Automobile Dealers Association, a trade group representing the state’s franchised dealerships. Its sponsor is state Sen. Tom Apodaca, a Republican from Henderson, who has said the goal is to prevent unfair competition between manufacturers and dealers. What makes it “unfair competition” as opposed to plain-old “competition”—something Republicans are typically inclined to favor—is not entirely clear. After all, North Carolina doesn’t seem to have a problem with Apple selling its computers online or via its own Apple Stores.
Several other states have considered similar legislation, for similar reasons, and Tesla has a mixed win-loss record.
It may behoove state legislators to remember the findings of an Alliance for American Manufacturing (AAM) poll commissioned last summer: 97% of respondents had a favorable view of products made in the United States. 91% viewed American manufacturing companies favorably, and 57% thought the quality of U.S.-made cars has improved.
In other words, limiting the availability of Tesla’s cars means stopping consumers from having access to vehicles they believe to be of superior quality, which they view favorably, and made by a company they respect.
Read more about Tesla's approach to selling cars.
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