After what has been described as either walking back a bad decision or simply a monumental miscommunication between corporate staff and employees, Tesla CEO Elon Musk decided to take it upon himself to clear the air regarding the closing of all physical Tesla stores in an effort to move sales directly online.
According to information obtained by Business Insider, Tesla stores that see regular and growing numbers of customers have nothing to worry about and “will absolutely not be closed down,” but for the stores with decreasing customers and an inability to meet minimum monthly sales standards, those stores will “gradually be closed down.”
The email continued stating “this is analogous to seeds on barren ground,” Musk said, continuing that “there is no reasonable way to justify keeping such stores open.”
“Unlike buying from other car-makers, ordering a Tesla doesn’t require any *physical paperwork*,” the email states, “However, many potential Tesla owners will still want to talk to a Tesla representative in person or want a test drive from a Tesla representative.”
With companies wanting to cut their losses in brick and mortar stores and convert to an e-commerce platform, as well as the increasing ease and productivity automation provides, it only makes sense that Tesla would freak out their tech-savvy employees who feared falling victim to the technological advances Musk and his numerous companies and brands are known for.
The full e-mail can be read below:
From: Elon Musk
Subject: Tesla Stores & Sales
There still some uncertainty around Tesla stores and the sales team. Hopefully, this note clears things up. Please let me know if there is anything I’ve forgotten to address. Stores with a high visitation rate and that lead to significant sales will absolutely not be closed down. It would not make any sense to do so, except in rare cases where the rent is absurdly high. Moreover, Tesla will continue to open stores throughout the world that meet the above criteria. Stores that are in a location with low visitation rates (i.e. empty most of their opening hours) and lead to low sales will gradually be closed down. This is analogous to seeds on barren ground. There is no reasonable way to justify keeping such stores open. Stores that are somewhere in the middle will be evaluated over time to see there is some way to allow them to cover their costs. If there is, they will remain open, otherwise not. However, these stores will be given a fair opportunity to prove their case.
The above principles also apply to the sales team. No one who is a major contributor to demand generation will be let go. That would make no sense. However, sometimes, in a company with 45,000 people, things happen that make no sense. I will do my best to remedy issues when brought to my attention directly or through [redacted email address].
What is meant by “all sales will be online” is just that the act of purchasing a Tesla will always be done via the potential new owner’s phone or computer. This is true whether they are at home or in a store. Unlike buying from other carmakers, ordering a Tesla doesn’t require any *physical paperwork*.
This is very different from normal expectations for buying from other carmakers and is simply meant to emphasize that ordering a Tesla is super easy and can be done in 2 minutes from your phone or laptop at Tesla.com. Ordering a Tesla is not much harder than ordering an Uber, but hardly anyone knows this!
However, many potential Tesla owners will still want to talk to a Tesla representative in person or want a test drive from a Tesla representative. Stores also have a small number of Tesla vehicles available to drive away immediately for customers that want a car right then and there.
This is why stores and Tesla product specialists and owner advisors will always be of critical importance to our long-term success.
Sources: Business Insider