My understanding is that these laws were put into place so that the manufacturers couldn't have it both ways - they couldn't enjoy the low startup-capital requirements of the franchise model, and then after using the franchisees to grow and scout out the best spots, cherrypick the most lucrative spots for manufacturer owned dealerships, driving out the independent dealerships by using their lower end-to-end costs. Because the franchisees are usually completely at the mercy of their chosen brand.
The perversion of the law is that Tesla has never had franchisees, and they're still being blocked by the laws in many states, contrary to the original intention.
I hate buying from dealers as much as anyone, but the law as I understand it makes some sense. I'm sure it varies from state to state and doesn't make sense in some.
> and then after using the franchisees to grow and scout out the best spots, cherrypick the most lucrative spots for manufacturer owned dealerships
This is easily resolved on the contract level. Knowing this, nobody with half a brain would start a franchise unless the parent company guaranteed the territory. That's how it works in virtually every other franchising market.
The perversion of the law is that Tesla has never had franchisees, and they're still being blocked by the laws in many states, contrary to the original intention.
I hate buying from dealers as much as anyone, but the law as I understand it makes some sense. I'm sure it varies from state to state and doesn't make sense in some.