Tesla reneges on showroom closures, but fate of Florida stores is uncertain

Even in Florida, which sells the second-most Model 3s in the U.S., the future of Tesla showrooms could be grim.
In this July 6, 2018, file photo prospective customers confer with sales associates as a Model 3 sits on display in a Tesla showroom in the Cherry Creek Mall in Denver. Tesla is walking back its plan to close most retail stores worldwide in a move the company says will force it to raise prices on most of its electric vehicles. The company still will move to online-only sales, but now says it won’t close as many stores as originally thought. Tesla announced last month that it would shutter most of its stores to cut costs so it could sell its lower-priced Model 3 for $35,000. [Associated Press]
In this July 6, 2018, file photo prospective customers confer with sales associates as a Model 3 sits on display in a Tesla showroom in the Cherry Creek Mall in Denver. Tesla is walking back its plan to close most retail stores worldwide in a move the company says will force it to raise prices on most of its electric vehicles. The company still will move to online-only sales, but now says it won’t close as many stores as originally thought. Tesla announced last month that it would shutter most of its stores to cut costs so it could sell its lower-priced Model 3 for $35,000. [Associated Press]
Published March 12
Updated March 13

The once endangered Florida showrooms of Tesla may be safe for now, but their future remains uncertain as the electric car manufacturer offers little in the way of guidance on what direction it’s headed.

Tesla recently announced, then walked back, a plan to close most of its stores in an effort to reduce the price of its entry-level Model 3 vehicles. The company originally planned to change lanes, from selling its vehicles in one of the 378 showrooms it has worldwide to having customers buy Tesla vehicles online or over the phone.

RELATED: Tesla to close stores to reduce costs for $35,000 Model 3

The plan was to cut costs by eliminating brick-and-mortar locations so it could drop pricing on its best-selling Model 3 to $35,000 in order to reach more consumers and generate sales the company needs to survive, CEO Elon Musk said in February. Before the announcement, the cheapest Model 3 started at $42,900. The move, Musk said, also would have brought pricing of higher-end models down by about 6 percent.

However, just two weeks and some quickly sold-off stocks later, Tesla announced it wasn’t going to shutter most of its showrooms after all.

RELATED: Tesla cuts 7 percent of workforce on road to make an affordable car

“Over the past two weeks we have been closely evaluating every single Tesla retail location, and we have decided to keep significantly more stores open than previously announced as we continue to evaluate them over the course of several months,” the company announced in a news release.

Instead, it will hike prices on some Model 3 variants, the Model S and Model X, by about 3 percent to keep base Model 3 pricing down. The new prices go into effect on Monday.

The company said all Tesla vehicle sales will be done online, however it will keep more showrooms open to offer customers a chance to test drive cars immediately. The company offers a 1,000-mile or seven-day (which ever comes first) return policy on all its vehicles.

RELATED: Parents of teen killed in Florida Tesla crash sue company

While the announcement may bode well for some of the 12 Tesla showrooms in Florida, a representative of the company said in a statement to the Tampa Bay Times it has not “shared regional-specific information on which stores have or could close.” The company said in a news release that choosing which stores will close will take several months.

Florida does have a performance advantage.

While California dominates the U.S. market for Teslas, Florida often comes in at a consistent, albeit distant, second place. In July 2015, Edmunds.com reported Florida was second to California in Model S owners and Bloomberg recently reported Florida was second to California for Model 3 vehicles registered in 2018.

Information from the Associated Press was used in this report.

Contact Daniel Figueroa IV at [email protected] Follow @danuscripts.

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