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Tesla Inc. is dropping one controversial retail model in favor of another.

The disruptive California electric vehicle maker said last week that it will close most of its 120 factory-owned stores — a distribution concept that has challenged the traditional U.S. retail system for years. And in their place,

Tesla will move to online sales only. The new plan is already raising questions. Unclear is how state motor vehicle rules will respond to an automaker selling vehicles online, direct to consumers, without local stores or service centers.

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