NADA to meet with Tesla to discuss retail store plans image

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

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

Tesla Motors is defending its retailing strategy against lawsuits by state auto dealer groups. The company is using using a company-owned store and service center strategy and has modeled its showrooms after Apple’s outlets. Tesla was sued this month by dealer groups in New York and Massachusetts, which claimed that Tesla’s strategy violates franchise laws.

In his defense, Tesla CEO said the company’s strategy is needed to properly educate potential customers about its electric cars.
“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. It is impossible for them to explain the advantages of going electric without simultaneously undermining their traditional business,” Musk wrote on Tesla’s website.

Tesla plans to have 19 stores, three galleries and 26 service centers by the end of this year in the United States.