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Is Tesla’s direct sales victory in Missouri a sign of things to come?

A US Tesla retail store. — Picture courtesy of TeslaA US Tesla retail store. — Picture courtesy of TeslaMISSISSIPPI, Dec 8 — The latest win by electric vehicle maker Tesla in a US court, a case about Tesla selling its vehicles directly to consumers, could have huge ramifications for the entire auto industry, especially dealerships, in the long run.

Before car dealers around the world panic too much, the case only concerns Tesla's licence to sell directly to consumers in the state of Missouri, which the state had sought to revoke as its laws require vehicles to be sold to consumers only through independent dealers.

Even so, Tesla will have been delighted that a three-judge panel chose to overturn a previous lower court decision from last year, which had directed the state not to renew the carmaker's licence and resulted in Tesla briefly closing its Missouri stores.

Tesla's business model is somewhat unique as it looks to sell its vehicles online and through its own stores, instead of dealerships operating on a franchise basis. The company currently has almost a hundred of these stores across the United States, as well as a number of galleries and service centers that are not able to process orders.

Of course, one US state and its laws are not going to change the way the global auto industry operates alone. But if the Tesla business model proves successful and sustainable, it could signal the beginning of the end for independent dealers and the current franchise model.

The Tesla court victory comes as it's also being reported that Ford is looking at a radical new way of selling its vehicles in China.

This week Ford announced a partnership with Alibaba Group Holding. This could see vehicles being sold direct to consumers though Alibaba's Tmall retail arm, as well as through a new "auto vending machine" store concept, both of which cut the traditional dealership out of the loop entirely. — AFP-Relaxnews

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