Tesla and their dealership suits

Every state in America has laws governing the retail sales of new automobiles. Some states — including Michigan — preclude auto manufacturers from selling cars directly to consumers, which means that when you buy a new car, you buy it from an independently-owned, franchised dealer.

Last September, Tesla Motors sued the governor, attorney general and secretary of state, claiming that Michigan’s prohibition against direct manufacturer sales is unconstitutional because it lacks a rational means of achieving any legitimate government purpose. Unfortunately for Tesla, it faces an uphill legal battle. Over the years this argument has often come before the courts, and each time the constitutionality of such laws has been upheld. Tesla has launched suits in many states, including Virginia, where it recently won a case.

We all know tht when multiple dealers for a single brand compete for business in a territory, prices drop.& In contrast, a direct sales model , which Tesla is seeking— by definition — eliminates the possibility for intra-brand competition.Tesla sells its cars at uniform and transparent list prices. Tesla customers pay the same price whether they purchase through Tesla’s website, at a local store, or at a store in a different state.”  A recent article in the Detroit Free Press analyzes the issue and comes to the conclusion that Tesla's business model is bad for consumers because If independent dealers are replaced with direct sales, then Tesla (along with other auto manufacturers) will earn higher profits and the consumers will pay higher prices for new cars.

 Tesla doesn't seem to want to quit do they?!  Even though, Tesla has stated, in court nonetheless, that when they have more models to sell, they will set up a dealer body because their distribution model won't work when they reach that production status.