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Electric cars to be sold in Menlo Park

Original post made on Sep 3, 2007

The electric automaker Tesla Motors has chosen Menlo Park as the site for its Northern California sales and servicing as the excitement builds for the mass production later this year of the Tesla Roadster.

Read the full story here Web Link posted Sunday, September 2, 2007, 10:04 AM

Comments (7)

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Posted by ToldUSo
a resident of Another Palo Alto neighborhood
on Sep 3, 2007 at 4:51 pm

Shame we couldn't get this dealership. There is an empty dealership on ECR in Palo Alto. Shame, because from the popularity of Prius in PA, I feel sure that Tesla will be similarly popular and now the PA's spending on Tesla will generate tax for Menlo Park rather than keeping it here in PA.

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Posted by Fred
a resident of Barron Park
on Sep 3, 2007 at 9:03 pm

Maybe PA loses the sales tax, TUS. But maybe not. It isn't clear to me that the sale transaction will actually happen in MP. With typical car makers, there is the OEM (say Ford) and dealers who are local businesses. So the dealer buys the car from the OEM and resells it. Not clear that Tesla is doing that; they may own their showrooms and sell directly from the factory to the customers. So sales tax would be paid in San Carlos, where the factory is.

I don't know if that is the case or not, but if I were Tesla, that's probably how I'd do it...

Also, where would they go in PA? The old Volvo store on ECR at Charleston? Lot is probably too small, and location only so so - even Volvo moved when they had the chance to take over University Ford's location next door.


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Posted by RP
a resident of Fairmeadow
on Sep 7, 2007 at 9:16 am

Interesting, Fred. So does that work for retail stores as well? Can't they also sell direct from the factory to customers, and avoid taxes?

For example, could Home Depot call their store a showroom? Since their headquarters is in Georgia, could they avoid paying CA state and local tax?

Are the rules different for cars? Or different for state vs. local taxes?

Thanks for explaining!

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Posted by Fred
a resident of Barron Park
on Sep 7, 2007 at 11:17 am

RP, this issue is a big one in the tax collection world - where do you have "nexus" and where does the transaction really take place.

If the item is stocked and picked up locally, it will be hard to argue that the transaction took place elsewhere. So retail stores might have a tough time claiming that. But, for instance, with a store with a catalog or ecommerce operation, you could browse the store, then get on the phone/computer and make your order via the mail. No sales tax collected (usually), in that case.

Cars are a little different (I believe), because you have to register them with the state. So you can't, for instance, buy a car in a no sales-tax state and bring it into a state with tax and get away with it (Mass and NH come to mind) - the taxing state will make you pay them anyway.

If a Tesla were made in San Carlos and flat-bed delivered to the customer's home (or picked up at the factory), it seems reasonable to me that the company would claim that no transaction took place in Menlo Park - it was just a showroom and service center, not a sales office. Not sure how they are actually doing it, of course.


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Posted by Da Mayor
a resident of Midtown
on Sep 7, 2007 at 11:41 am

We wouldn't want this dealership in Palo Alto--it may create too much traffic and negatively impact my quality of life. I really hope that opening it in Menlo Park will not create too much cut through traffic in Palo Alto, especially on Embarcadero Road.

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Posted by Paly reporter
a resident of Palo Alto High School
on Nov 20, 2007 at 1:00 pm

Check out this article about electric cars on The Paly Voice, Palo Alto High School's online journalism program. Web Link

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Posted by Greg
a resident of Southgate
on Nov 20, 2007 at 3:46 pm

"The Xebra is a clean way for people to make local trips," Smith said. "Instead of getting into a gas car that sends out pollution into the air, a person can take their Xebra without sending any pollution in the air."

Paly reporter,

I am all for electric vehicles. They are the future. However, where is all that electrcitiy going to come from to recharge these vehicles? Did you ask the dealer this question?

Sorry, but further commenting on this topic has been closed.

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