Central Valley Auto Transport makes $13.8 million deal with Tesla
By Paul Myers @PaulM_SGN
STRATHMORE – The Strathmore based car-hauling company, Central Valley Auto Transport, is now the proud owner of 49,967 shares of Tesla stock worth $13.8 million.
Tesla’s purchase of Central Valley Auto Transport’s car-hauling fleet was announced last week and both parties have remained mum over the details. Multiple national outlets had reached out to the selling party, Tesla chief financial officer Deepak Ahuja and Central Valley Auto Transport President, David Ertl. CNBC.com reported that Central Valley Auto Transport simply hung up the phone when they called, twice.
Tesla announced last month they would be winding down many of their stores and moving to online-only sales as a way to pass savings onto their customers. However, over the last three weeks Tesla says they have been evaluating every retail location and decided to keep significantly more stores open, than they had originally intended.
“When we recently closed 10% of sales locations, we selected stores that didn’t invite the natural foot traffic our stores have always been designed for. These are stores that we would have closed anyway, even if in-store sales made up our entire sales model,” the press release stated.
They noted that a few more stores in high visibility locations that were closed due to low throughput will be reopened, but with a smaller Tesla crew.
“As a result of keeping significantly more stores open, Tesla will need to raise vehicle prices by about 3% on average worldwide. In other words we will only close about half as many stores, but the cost savings are therefore only about half,” the statement read.
Tesla stores will not be like car dealerships. Instead all sales worldwide will still be done online. Customers will come into stores and simply be shown how to order a Tesla on their phone in a few minutes. This will limit the prospect of test drives but the option is still available upon request.
“The generous return policy of 1,000 miles or 7 days, whichever comes first, should alleviate the need for most test drives,” a Tesla press release states.
Stores will also carry a small number of cars in inventory for customers who wish to drive away with a Tesla immediately.