Tesla to switch to online-only sales but Edinburgh showroom expected to remain

It will be like buying a pair of jeans online – if you don’t like your new electric car, you can just send it back.

By The Newsroom
Friday, 1st March 2019, 2:13 pm
Updated Saturday, 2nd March 2019, 11:47 am
The Edinburgh showroom is expected to be retained. Picture: TSPL
The Edinburgh showroom is expected to be retained. Picture: TSPL

Tesla plans to revolutionise selling cars by scrapping traditional showrooms so it becomes like any other internet purchase.

It said the process would take just one minute, in what’s believed to be a first for motor manufacturers.

However, it is understood the company will retain its Edinburgh store – the only one in Scotland – because it is one of those with high footfall. There are 19 others in the UK. The company’s separate service centre in Edinburgh would also stay open.

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Tesla's Model 3 is to go on sale in the UK in the second half of this year. Picture: David Zalubowski/AP

Tesla said cutting costs would enable it reduce the price of its new Model 3 by 6 per cent to $35,000 (£26,400) to drive up sales.

Its first mass-market car, less than half the price of previous models and with a 220-mile range between charges, is due to go on sale in the UK in the second half of this year.

Taxes and import duties are expected to increase the price to £33,000.

Chief executive Elon Musk said: “This is the only way to achieve the savings for this car and be financially sustainable.

“It is excruciatingly difficult to make it for $35,000 and be financially sustainable.”

The company explained: “You can now buy a Tesla in North America via your phone in about one minute, and that capability will soon be extended worldwide.

“We are also making it much easier to try out and return a Tesla, so that a test drive prior to purchase isn’t needed.

“You can now return a car within seven days or 1,000 miles for a full refund. With the highest consumer satisfaction score of any car on the road, we are confident you will want to keep your Tesla.”

The Silicon Valley company said it would be “winding down many of our stores” over the next few months, with “a small number of stores in high-traffic locations remaining as galleries, showcases and Tesla information centres”.

Tesla said the online move would enable it to lower all prices by an average of 6 per cent, including its more expensive Models S and X.

Sven Raeymaekers, a partner at technology advisers GP Bullhound, said: “With more than 60 per cent of car buyers deciding on brand, model and price before setting foot in a showroom, it should come as no surprise that dealership visits are declining.

“The challenge for car makers is to connect with potential customers at the point of consideration – online.”

But Neil Greig, of motoring group IAM RoadSmart, said: “The lack of a test drive may be a barrier to many who have doubts about the electric car driving experience.

“However, this has to be good news in the overall effort to make electric cars more mainstream.”

Victor Hill, a strategist at Master Investor, said Tesla could be a world beater if it cut prices further.

He said: “if Tesla could bring the price of its mid-range vehicles down to that of equivalent internal combustion-powered vehicles, it could become Apple or Amazon.”