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Tesla Motors takes charge on South Coast

By   /   Friday, January 23rd, 2015  /   Comments Off on Tesla Motors takes charge on South Coast

The store will feature interactive touchscreens, design centers and other tools for buying and customizing made-to-order vehicles directly from the Palo Alto-based manufacturer.

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A Tesla Motors Model S electric vehicle stands on display at the company’s showroom in Beijing, China. (Bloomberg News photo)

A Tesla Motors Model S electric vehicle stands on display at the company’s showroom in Beijing, China. (Bloomberg News photo)

After months of speculation, Tesla Motors officials have confirmed the opening of the electric carmaker’s first dealership in the Tri-Counties, to open in Santa Barbara sometime in the next few months.

The company has not released a firm opening date. The new 25,000-square-foot store will be a sales and service center located at 400 Hitchcock Way, the former location of Hughes Automobile Co., which shut its doors in December. The store will feature interactive touchscreens, design centers and other tools for buying and customizing made-to-order vehicles directly from the Palo Alto-based manufacturer, according to Tesla Spokesperson Alexis Georgeson.

“The Tesla store will feature a big screen on the back wall, private sitting areas where customers and product specialists can talk more intimately, design studios where visitors can customize their Model S, and a display Model S that invites visitors to slide into the driver’s seat,” Georgeson told the Business Times in an email. “Test drive vehicles are also available so people can feel the thrilling performance of Model S.”

The Model S sedan is Tesla’s flagship car. It retails for a base price of $69,900 and has a battery range of up to 270 miles.

On Feb. 2, the city of Santa Barbara’s Architectural Board of Review will review Phase 1 of the store’s construction, which includes remodeling of the existing building and building a walkway to the store’s entrance, said Santa Barbara City Planner Suzanne Riegel.

“It could be approved sometime in February, but I don’t know if the board will be ready to approve it at the first meeting,” she said. “They’re still waiting on documentation for the environmental review.”

Like Tesla’s other stores, the new location will not carry inventory. It will sell its cars through a tech-savvy business model that puts the focus on customization and design, rather than traditional marketing and sales efforts.

“Every car that comes off the Tesla factory line in California is built to order, customized to meet each customer’s specific wants and needs,” Georgeson wrote in an email. “This sales model helps Tesla maintain a no-pressure environment in our stores; we never have an inventory lot to move and none of our product specialists work on commission.”

Another thing that sets Tesla apart from other carmakers is its direct-to-consumer sales model, which has drawn criticism from traditional American car dealers. Though the manufacturer currently has more than 50 showrooms across 20 states, its practice of owning and operating its dealerships directly has been outlawed in a number of states, including Texas and New Jersey, due to laws requiring carmakers to retail their vehicles through franchised car dealerships.

In the U.S. car capital, Michigan, Gov. Rick Snyder signed a bill in October 2014 to ban Tesla from selling its automobiles without a dealership network. The bill also prohibits auto manufacturers from setting the fees that franchised car dealers can charge customers.

Despite the blowback, Tesla has charged forward with expansion in other states. The same month that Michigan outlawed Tesla’s direct sales, the carmaker unveiled its dual motor all-wheel drive version of the Model S and an autopilot system.

In company filings with the U.S. Securities and Exchange Commission, company officials said these new additions have drawn bigger sales that are expected to grow further in 2015.

“These announcements have significantly increased our weekly Model S order rate. Based on net orders since that announcement, excluding the extraordinary initial demand peak, we are confident of a 50 percent increase in both net orders and deliveries for Model S alone in 2015,” the filings state. “Moreover, we expect that demand for Model S will continue to increase worldwide as we grow our customer support infrastructure and continue to broaden the appeal of our products, and as consumer awareness improves.”

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