Press

Fran O’Hagan is a methodical guy who’s baffled as to why Tesla stores year after year score so low in an annual mystery-shopping study of dealership sales effectiveness.  The electric-car maker, which has skirted the traditional dealership franchise system in favor of owning its own sales outlets, ranked dead last on this year’s Pied Piper Prospect Satisfaction Index.

The study by brand measures how well dealerships follow sales processes, such as asking qualifying questions and ultimately asking for the sale.  Infiniti took the top spot (for the first time), followed by Lexus, Mercedes-Benz, Toyota and Audi.  But Tesla, with its factory-direct distribution model, has occupied the survey’s cellar for the last three years. Volvo dealerships scored only slightly better.

“Tesla leaves me scratching my head,” O’Hagan, president and CEO of consultancy Pied Piper Management, tells WardsAuto. “They own all of their stores, so you would think each one would be doing the same thing. But they’re not. Tesla is consistent in its inconsistencies.”  He speaks of “a huge variation” in the automaker’s store-to-store sales effectiveness.  For example, a few Tesla dealerships do all the right things. “They want you to buy, and prepare you to buy,” O’Hagan says.  But such good habits are outweighed by lackings mystery shoppers found at most other Tesla stores where the staffers tended to act like “museum curators,” O’Hagan says.  They spoke knowledgeably about the products and answered customer questions, but shied away from asking for the sale in an ill-advised demonstration of underselling.  Nor did most Tesla sales representatives ask if customers had vehicles to trade in. Most consumers do, and put the equity from those trade-ins towards the purchase of new cars.  Industrywide, the study says 86% of sales peopled ask customers about trade-ins, but only 36% of Tesla staffers did so. Why so low? “Because trade-ins are a pain in the neck for Tesla,” O’Hagan says.  Unlike other brands with dealers who purchase trade-ins and then sell them on the used-car lot, Tesla relies on a third party to handle and remarket trade-ins.     

This is the 10th year of the Pied Piper satisfaction index study for which mystery shoppers go into dealerships to gauge selling skills.