America is under attack, but it’s not the Russians we need to be worried about. It’s car dealers. Not all car dealers are bad, but even the good ones are protected by bad laws, and all of them are protected by dealer associations, who are like ISIS, the IRS and cancer rolled into one.
All four horsemen of the American economic apocalypse — cronyism, cowardice, hypocrisy and protectionism — are represented by dealer associations. The worst of the lot, those of Texas, Michigan and Virginia, are now joined by Missouri’s MADA, whose legal victory over Tesla may deprive them of the right to sell cars in that state.
We need a new House on Un-American Activities Commission, this one focused on the anti-competitive forces that are the real Communists among us.
Competition is at the heart of American economic strength. The opposite of competition is Communism, central planning and failure. Competition is how the United States won the Cold War. It’s how and why species, technologies and business evolve and grow. It’s why homo sapiens are the dominant biped, the World Wide Web crushed the Minitel, and Google eclipsed AltaVista. It’s why everyone is scrambling to catch up to Tesla by embracing the technologies they’ve pioneered.
Dealer associations like MADA are terrified of competition, and by attempting to stifle it are hurting you, and weakening our auto sector and America itself.
Tesla’s War To Save America Car Manufacturing
Tesla has been fighting a just war on multiple fronts, from technological to legal to conceptual, but the real front is philosophical. Whether or not you believe in direct sales, electrification, self-driving cars or government subsidies is irrelevant. Elon Musk believes in competition, and MADA doesn’t. Anything that gets in the way of competition — whether politics, regulation or corruption — is un-American.
There can be only one exception: consumer safety. Guess what? The Tesla Model S has the best safety rating of any car ever tested.
Tesla had already set up shop in Missouri, selling and servicing cars for their happy customers, but that was too much for MADA, who sued under the state’s dealer franchise laws to have Tesla’s dealer license renewal rejected. MADA’s argument? It’s the law. Tesla should obey it.
Guess what? We’ve had a lot of bad laws that last too long. Slavery used to be legal. Women couldn’t vote. MADA claims Tesla’s factory-direct sales bypassed the franchise law, which allegedly protects consumers.
It’s clear that consumers don’t need protection from Tesla at all. People love Tesla so much they’re practically the Apple of automotive. In fact, the latest Consumer Reports Owner Satisfaction Survey ranks Tesla ranks #1, with 91% of owners saying they would buy another. The legacy automakers? Porsche ran a close second at 84%. Everyone else in the seventies. Or worse.
If consumers have already decided, so has the stock market, sending Tesla post-IPO from $20/share to a 2016 close of $216. The media? Nearly 40% of automotive press is devoted to Tesla, a company with zero marketing or advertising budget. 2016 was Tesla’s best year ever, and they received orders for nearly 400,000 orders of the upcoming Model 3, a sub-$40k sedan derived from the Model S, one of the most important cars of all time.
Competitors have also decided: Tesla is a threat. Tesla single-handed invented the market for electric and autonomous cars. Every electric or autonomous automotive technology ever sold before the Model S was pathetic. Every competitor’s press release pays lip service to their efforts to catch up. Every dismissive statement conceals their fear. Every electric powertrain shown, every autonomous feature announced, every CTO hire and software company investment, all are done in the hopes consumers will wait 12-36 months for the old guard to catch up with where Tesla is today.
Sadly, all those Tesla-killers have so far been wishful thinking.
I have no doubt the leading automotive minds in Germany, Detroit and Japan will get future-thinking products to market. They have to, if they don’t want to be one of the eight carmakers buried when the industry shrinks to six, according to Morgan Stanley and Soichiro Honda, founder of you know who.
Competition within the domestic car market strengthens us vis-a-vis imports. Tesla created the market for premium electric and autonomous cars, which overlaps with luxury imports. No domestic manufacturer makes anything rivalling the best German sedans. If Tesla goes away, we cede that market for another generation or more. American manufacturers already gave away the hybrid baby to Toyota. With the Model 3, Tesla hopes to reclaim the market for affordable innovation.
Protecting entrenched interests at the expense of domestic manufacturing and innovation doesn’t sound very patriotic to me.
If you want to talk about being pro-America, Tesla is the most American car company out there, representing the highest of American ideals. Ambition. Ingenuity. Confidence. They manufacture in the United States. They’re building factories. They’re hiring and training the best minds on the cutting edge of the future of transportation. Real job creation? Thy name is Tesla.
In order to grasp MADA’s vulgar hypocrisy, let’s take a look at the MADA Board of Directors, a group whose leaders’ political donations show no apparent consistency other than to serve their own interests, not coincidentally representing brands behind the curve of where Tesla and the automotive industry are headed.
Outgoing MADA Chairman Bob Beine, representing Republic Ford, also owns an FCA franchise. FCA CEO Sergio Marchionne’s positions on autonomy and electrification are well known, and they’ve been on deathwatch so long jokes are no longer funny. Beine is a free marketeer when it suits him, having donated thousands to Republicans such as Missouri Senator Roy Blunt, Representative Billy Long, former Representative Melton Hancock, former Speaker of the House John Boehner, and former state treasurer Sarah Steelman.
But when it comes to Tesla, Beine hates free markets. Gotta protect those consumers from factory direct sales.
Dave Mungenast, Jr., MADA’s Chairman-Elect, represents Mungenast St. Louis Honda — a manufacturer generally behind the curve on cutting edge tech — but also owns a Toyota/Lexus franchise. He donated money to Republican Representative Ann Wagner, ergo, free marketeer. He also donated money to Russ Carnahan, a Democrat who supported tax credits for hybrids and believes in global warming. What a coincidence. I hear Japanese hybrids are very popular, especially that Prius thing, and one particular Lexus crossover.
But when it comes to Tesla, Mungenast hates free markets, green tech and the environment. Gotta protect those hybrid customers who might get upsold to the best electric car on the market.
What precisely is MADA doing besides paying their lawyers to deprive the good people of Missouri of cars they want to buy? It’s certainly not hiring the right social media people. Check out MADA’s Facebook link:
Seriously? MADA’s Facebook page is dead? If it’s dead, MADA is just incompetent. Or is it just private? If so, why? They already have a password-protected section of their site. I doubt they have much worth hiding except their craven weakness. Oh, wait. It’s only broken from the About MADA page. The Facebook link from the homepage works fine. Looks like incompetence. It also looks like they have a 2.4 out of 5 rating from page visitors. It also looks like MADA deletes pro-Tesla comments from the discussion:
Let’s check out MADA’s Twitter:
Hmmm. 633 followers. Not bad. Actually, wait. MADA joined Twitter in 2009 and only has 633 followers? Sad! And they’re following 650 people? If you know anything about Twitter, you know that’s a deadly ratio. The only good news here is that they weren’t dumb enough to buy followers, which would have been inexplicably pathetic.
As opposed to the explicable, highlighted by the insulting hypocrisy of what appears to be MADA’s mission statement:
If MADA is so “dedicated to acquiring, preserving, and disseminating information to all branches of the automotive industry” then why is their Twitter so crappy and why are pro-Tesla Facebook comments being deleted?
If they “hold a strong commitment to engaging in non-profit scientific and educational activities” then why are they expending resources to fight Tesla, the automotive industry’s greatest ambassador in innovating “the sale, marketing, delivery, repair and use” of motor vehicles?
Their definition of “anything and everything” is worthy of Pravda at the height of the Cold War.
Here’s MADA’s statement on the "non-profit" educational function they provide:
MADA would be wise not to invoke the scientific method, which is what got Elon Musk where he is today. Maybe they should donate to a law school, whose graduates’ services they clearly need. As for the "non-profit" aspect, they sure hope to profit from the omission of any information that might benefit Tesla. So much for helping out consumers.
But wait, that's not MADA's mission.
MADA represents car dealers, whom 75% of people hate. It’s why Tesla wants to sell direct. If the legacy manufacturers were innovating — and MADA was capable of executing on their mission statement — Tesla wouldn’t have a business model.
Let me tell you what MADA has educated me about: if the American auto industry wants to be great again, it needs better representatives. Right now, Tesla is that representative. If legacy car dealers felt like Tesla stores — which feel like Apple stores — MADA might have one-quarter of an argument. Alas, MADA has nothing other than protecting a weak hand getting weaker every day “Tesla killers” fail to arrive.
Ford, GM and everyone else selling domestically is being betrayed by dealer associations like MADA, who would spend money to litigate rather than even attempt to do their self-proclaimed jobs. No one who wants a Tesla will be dissuaded by stopping their sale in Missouri. They might be attracted to a rival car — if such a car existed — if legacy dealers matched Tesla’s shopping and support experience.
Good luck with that.
I hear Chevy Bolts are only available in a couple of states. Missouri isn’t one of them. I wonder why.
How To Make The America Car Industry Great Again
I’m not telling you to buy a Tesla, although if you’re in the market for one you won’t regret it. I’m suggesting that if you don’t want a Tesla, don’t buy a car from an active member of a dealer association like MADA. Vote for America with your wallet. Send Beine and Mungenast a message. If you live in Missouri and want a Ford, Honda, GM or Toyota product, don’t buy it from the people behind MADA. Drive to a neighboring state and buy it from one of their competitors. Don’t worry about whether it’s an American brand. A lot of foreign brands are built here. It just takes a little research.
If you want to send MADA a letter or call to leave a message, they can be reached here.
Or put down a deposit on a Tesla Model 3. Something tells me by the time it arrives, it’s going to be more advanced than the so-called Tesla killers that are supposed to arrive around the same time. If it's as revolutionary as the Model S, the industry will tremble, which is a good thing.
Alex Roy is an Editor-at-Large for The Drive, author of The Driver, and set the 2007 Transcontinental “Cannonball Run” Record in 31 hours & 4 minutes. You may follow him on Facebook, Twitter and Instagram. He doesn't own any Tesla stock. He owns a Morgan 3-wheeler, a Citroen SM, an old BMW M5, and an '87 Porsche 911.