ElI5 why do we have car dealerships?
In: 160
Adam Ruins Everything had a segment on it years ago.
[Basically, it’s because of lobbying.](https://youtu.be/uMWmYJOa-BM?si=ElXNpKQjEj3wRqwc)
Very eli5: when car manufacturers first started, they couldn’t raise enough money to build, stock, and staff dealerships all over the country (and the world). So, they let local investors raise and risk their own money and decide if their local cities were worth opening a dealership in.
As years went on, manufacturers became able to raise the funding on their own. Since dealership owners didn’t want to be squeezed out of their investments, they got states to pass laws that would prevent manufacturers from opening their own showrooms and selling directly to the public.
Last time I bought a new car I knew more about the vehicle than the guy selling me mine and he owned the same make/model. Do yourself a favor, research the vehicles, get pre-approved by the lender of your choice and don’t pay any mark-ups or documentation fees. Also the trade-in is a separate transaction and never give them your keys.
Another question is why haven’t dealerships just open on tribal land like Tesla has started doing to bypass all of the dealership bureaucracy
Cars used to be like iPhones. Ford, for example, would not allow just anyone to service their vehicles. They wouldn’t sell parts to 3rd parties or consumers, and other shenanigans.
So laws were put in place to make it illegal for car companies to operate that way, and some things improved for consumers but greed, as always, found a way to corrupt some of that progress.
Today, effectively the same battle is going on with tech companies and upstart car companies like Tesla, only with modern tech companies can be even more exploitative than those car companies a century ago. It’s what is going on with the “right to repair ” laws you are maybe hearing about.
As for car companies, they should be able to sell direct but should be required to sell parts, tools, instructions and other things to 3rd parties like modern day right to repair laws require.
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