Apple Fuels Tesla’s Retail Drive


Apple’s revolutionary retail experience has played a key role in turning the iPhone maker into the largest technology company in the world. Now, Tesla Motors is looking to emulate its Silicon Valley neighbor in the auto industry.

Founded by Elon Musk, Tesla Motors is unlike major automakers such as Ford Motor and General Motors in that it doesn’t have dealerships. Instead, Tesla has stores based in malls around the country, similar to any other retailer. There are no salesmen in the stores, but rather product specialists who teach consumers about Tesla vehicles such as the Roadster, Model S, or Model X.

“Our product is different from most products. It’s a computer on wheels,” George Blankenship, vice president, worldwide sales and ownership experience, said in an interview with TheStreet.

Blankenship helped build Apple’s retail experience and is drawing on that experience to develop the electric automaker’s retail arm. Tesla’s models are not for everyone, due to their high price points — the Roadster can run to as much as $100,000 — but by placing the stores in malls, the automaker is raising awareness of its products.

Blankenship noted that Apple’s growth really started to accelerate when the iPod Mini and cheaper versions of the iPod came out. Tesla hopes to achieve similar results, especially as it builds its third-generation vehicles. Right now, Tesla’s vehicles are aspirational in nature, but the company wants it to be much more, Chief Financial Officer Deepak Ahuja said in an interview. “We want to offer a very good value for customers,” Ahuja noted.

Tesla has 22 stores across the globe, six of which opened since the beginning of 2012. Over 650,000 people have gone through the six stores, although that may be because Tesla is a newer company and there is a mystique surrounding the company’s cars. Test drives of the new Model S start next weekend.

Tesla’s ownership of its stores has caused some legal issues for the company, as automakers are not allowed to own their own dealerships. Blankenship says the company has been in compliance with every municipality the company has locations in. But make no mistake, Tesla is taking a very different approach to the than the “Big 3” in Detroit. That’s “thinking different.”

—By TheStreet.com’s Chris Ciaccia

Additional News: Tesla’s New Model Goes on Sale June 22

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