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34 www.glancda.org of all, so it should be considered first. Franchises issue warranties and safety recalls. If you put manu- facturers in charge of that process, you have a problem. How many years did GM management know there was a problem with a faulty ignition, and chose to do nothing even though fixing the problem would have been inexpensive? As it was, Mr. Appleton says dealers did report the problem to GM, and that’s why the situation eventually became public. Independent fran- chises can and do protect customers better than car manufacturers do. • What about competition to keep prices down? A manufacturer who sells directly to customers has a monopoly. As Mr. Appleton puts it, “The Tesla factory-controlled model is a vertically integrated model in which whatever the manu- facturer wants them to pay for the vehicle is what they pay. When it’s a monopoly it is never better for the consumer. They eliminate competi- tion at the retail level.” • “Different” does not equal “better.” There’s no reason why innovative car manufacturers can’t use the same franchise model that is used by other car manufacturers. Deal- erships are selling electric cars and hybrid cars already. The process is working fine as more and more people begin to buy the latest in- novations. • Franchises are an efficient way to sell a lot of cars. If Tesla wants to increase the number of its sales, then at some point its management would be wise to do so through franchisees. • It doesn’t work to have franchises compete with car manufacturers because it creates an uneven playing field. In other words, it’s a bad idea because it isn’t fair to have people playing by two different sets of rules and expectations. • Having a car manufacturer sell directly to customers instead of through a franchise sets a prec- edent, and precedents matter. Once the process itself begins to change, it’s hard to know where it’s going to go. Why change what isn’t broken? Would Tesla Motors do better policing itself than GM did? According to an at- torney named Vince Megna, who has made a living out of lemon-law litiga- tion, you have to sign a confidentiality agreement before you buy a car from Tesla Motors. That makes it hard to take the company to court if you’ve got a problem. One of his clients, Robert Montgomery, did buy a car from Tesla Motors. He paid a total of about $98,000. During the first five months that Mr. Montgomery owned his car, it spent 66 days in a repair shop because of a long list of malfunctioning parts: air bags, batteries, fuses, and firing harnesses. Mr. Montgomery had problems getting the car to start. If it started, he couldn’t put it into drive. The dash wouldn’t light up, the door handles didn’t open the door, the controls didn’t work, and the coolant pumps were broken. Tesla Motors was not interested in mak- ing things right even though the car was clearly a “lemon.” And Mr. Mont- gomery didn’t have a dealer who could advocate for him, because he bought the car directly from Tesla Motors. Mr. Montgomery is not the only one who had a problem with his Tesla. Appar- ently, you can be famous and yet still end up with a lemon. George Clooney bought one of the very first models (he says he thinks he bought the fifth one). His didn’t work either. Then there’s the problemwith when they catch on fire. Elon Musk has another blog post about that particular issue. According to Mr. Musk’s blog post, a fire in an electric car is not as bad as one in a gas-powered car; more than that, there have been no Tesla-related deaths or injuries so far, for any reason, even though he is sure that Tesla Motors won’t have that distinction forever; and, finally, he and Tesla Motors are proud of their safety record so far. Franchises do have a role to play in terms of price, safety, and other issues. Elon Musk clearly disagrees. Many states, however, believe that the dealership delivery sys- tem works well and works well, draw- ing the lines for discussion and possible litigation.  Sources: http://www.teslamotors.com/about http://host.madison.com/ct/news/local/ writers/steven_elbow/lemon-law-king-vince- megna-sues-electric-car-maker- tesla/article_669bb903-520a-57b5-948b- fcc165d735d6.html http://www.businessinsider.com/elon-musk- blog-post-on-tesla-fires-2013-11 http://cars.chicagotribune.com/fuel-efficient/ news/chi-dealerships-or-direct-sales-tesla- car-sellers http://www.allacronyms.com/ATAE http://inventors.about.com/od/ mstartinventions/p/Elon-Musk.htm http://www.foxnews.com/opinion/2014/04/08/ five-takeaways-from-gm-safety-debacle/ TESLA MOTORS WAS NOT INTERESTED IN MAKING THINGS RIGHT EVEN THOUGH THE CAR WAS CLEARLY A “LEMON.” This publication is intended for general information purposes only and does not and is not intended to constitute legal advice. The reader must consult with legal counsel to determine how laws or decisions discussed herein apply to the reader’s specific circumstances. $ & 3 5 * ' * & % 1 6 # - * $ " $ $ 0 6 / 5 " / 5 4 $ 0 . 1 " / : - - 1 $ & 3 5 * ' * & % 1 6 # - * $ " $ $ 0 6 / 5 " / 5 4 1964-2014 50th Anniversary “Value for your money, quality for your time” C M Y CM MY CY CMY K  Tesla — continued from page 33