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Volvo faces legal pushback in California on possible pivot to Tesla-style direct sales model

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On Tuesday, the California New Car Dealers Association (CNCDA) filed a petition against Volvo USA with California’s New Motor Vehicle Board claiming the legacy car maker violates state franchise laws banning manufacturer competition with dealerships. The group claimed the “Care by Volvo” (CbV) subscription service launched in early 2018 which provides all-in-one packages of 24-month leases, premium insurance, concierge service, and most vehicle maintenance, was using Volvo dealers as de facto “agents” in an effective practice of dealing directly to consumers. The move is reminiscent of Tesla’s struggles, itself being the subject of dealer franchise-focused legal actions. However, the legal questions aside, the sum of CNCDA’s complaints additionally indicate its objection to Volvo’s possible ongoing shift to a Tesla-style overall direct-sales model.

In Volvo’s CbV subscription plan, buyers select from two currently offered models – the S60 and XC40, including customizations – via an app or a corporate-run website. Once the car selection is final, an agent from Volvo’s financial services company (the “Volvo Concierge”) contacts the buyer and finalizes the package particulars, after which delivery is scheduled at a local participating dealership. During the online process, the customer is given a guaranteed monthly subscription price with the option to upgrade after 12 months and chooses the dealership that will complete the sale. Volvo provides the financing directly through a separate financing branch, and the insurance is provided by Liberty Mutual. The dealer handles the final sales contract, payment, and vehicle hand-off.

While the dealerships participate in the CbV program voluntarily and receive an 8% sales commission, CNCDA claims the process significantly limits the dealer’s ability to build a (profitable) relationship with the customer and eliminates dealer earnings potentials stemming from financing services and other package “add-ons” during the sales process. On its face, this might seem like a reasonable argument, but Volvo’s perspective seems to be addressing customer preferences, a new era of sales strategies, and an effort to reach a new customer market. In an aim to make the brand more appealing to a younger generation accustomed to app-based ride-hailing and a la carte video entertainment services, Volvo may be hoping CbV will help them make inroads towards Millennials in particular.

An overview of the “Care by Volvo” subscription sign up process. | Credit: Volvo USA

In an interview with Global Fleet, Alan Visser, CEO of Volvo’s Chinese sister brand, Lynk & Co., detailed how the Millennial connection is explicitly part of that company’s subscription-only business model: “On the other [hand], there is [the] smartphone aspect…Millennials want maximum flexibility and all-inclusive pricing rather than long-term commitments and hassle. Our subscription model is more than just a private lease. It includes services like pick-up and delivery, cleaning, and lots of other things I cannot disclose just yet,” he stated. Also, Lynk & Co intends to only sell hybrids and/or battery electrics, adding yet another Volvo parallel to Tesla. That, and its plan for showcasing its vehicles prior to customer purchase: “In large urban areas we will have so-called offline stores: small, sociable brand boutiques,” Visser additionally explained in the interview.

In their petition, the California dealer’s group made the connection between Lynk & Co and Volvo USA a key part of their case for Volvo’s competition law violation. According to Jalopnik’s review of a pre-production model of Lynk’s first vehicle, the direct-sales subscription is possibly being tested in the US via the Care by Volvo program. “They’re very eager to try out this subscription model of car ownership, or subscribership…They’re sort of testing the waters with the Care by Volvo program, which is proving to be a good plan,” Torchinsky writes, summarizing his talks with the company’s representatives. This article was referenced in CNCDA’s petition against Volvo’s CbV program. Torchinsky goes on to further describe how the dealership experience “sucks” enough for consumers to have opened up a new market for doing car sales business which Lynk has intentionally capitalized on.

The Care by Volvo app, as pictured on Volvo’s website. | Credit: Volvo USA

Protecting dealers doesn’t appear to be the main priority of CNCDA. In their petition, the New Car Dealers Association seems to be taking the biggest issue with Volvo’s possible negative position on the franchise model entirely, using the legal system as a toolkit to keep customers stuck in an aging infrastructure rather than innovating with the times and finding less restrictive ways to make everyone happy. “‘Subscription programs’ like CbV have been described as a way for the manufacturer to cut out the dealer and ultimately eliminate the franchise model,” the group stated in the introduction of their petition to the New Motor Vehicle Board. Where franchise laws were set up to protect dealers from forced manufacturer bidding, the association seems to be attempting to morph manufacturers wanting to do their own customers’ bidding into an attack on dealer rights. Tesla has certainly encountered this type of morphing even without the challenge of having private dealerships.

In December of last year, a Connecticut state court judge concluded that Tesla’s Greenwich Ave. gallery was operating like a dealership and required a license to do so, something the electric vehicle company is not eligible for because it doesn’t have franchises. The Connecticut Automotive Retailers Trade Association (CARA) was the party responsible for initiating the proceedings which led to the judgment, an organization often at the front lines of defending the state’s franchise laws from would-be offenders. CARA holds the position that vehicle sales should only be conducted through licensed independent dealerships, leaving direct-sales manufacturers like Tesla with limited options for providing its products to customers wanting to buy them.

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The car subscription model isn’t unique to Volvo. Luxury car manufacturers especially seem to have also discovered the new market potential of app-driven car flexibility: Access by BMW has price tiers in the $2000-$3700 range for their packages (which include unlimited vehicle swapping), but it’s only available in Nashville, Tennessee for now. The UK-only Carpe by Jaguar Land Rover has $1200-$2900 packages with similar features as CbV, the Mercedez-Benz Collection is similar in price to Carpe, and a few others in that range are being developed and expanded by their respective manufacturers. Several third-party subscription services have also popped up with more flexible lease terms and more economical pricing. Clearly, the trend is showing data points that are worth investment attention.

With all the controversy, it might not even be dealerships that stand to lose the most with subscription models. The case has been made for classifying them as rental cars, which would be another market that might take issue with manufacturers latest ideas for doing business. Some of the services, like Flexdrive, are practically set up to be permanent rental solutions. As with all things, though, only time will tell.

2019-1-15 CNCDA Petition Re… by on Scribd

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Accidental computer geek, fascinated by most history and the multiplanetary future on its way. Quite keen on the democratization of space. | It's pronounced day-sha, but I answer to almost any variation thereof.

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Tesla UK sales see 14% year-over-year rebound in June: SMMT data

The SMMT stated that Tesla sales grew 14% year-over-year to 7,719 units in June 2025.

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Credit: Tesla

Tesla’s sales in the United Kingdom rose in June, climbing 14% year-over-year to 7,719 units, as per data from the Society of Motor Manufacturers and Traders (SMMT). The spike in the company’s sales coincided with the first deliveries of the updated Model Y last month.

Model Y deliveries support Tesla’s UK recovery

Tesla’s June performance marked one of its strongest months in the UK so far this year, with new Model Y deliveries contributing significantly to the company’s momentum. 

While the SMMT listed Tesla with 7,719 deliveries in June, independent data from New AutoMotive suggested that the electric vehicle maker registered 7,891 units during the month instead. However, year-to-date figures for Tesla remain 2% down compared to 2024, as per a report from Reuters.

While Tesla made a strong showing in June, rivals are also growing. Chinese automaker BYD saw UK sales rise nearly fourfold to 2,498 units, while Ford posted the highest EV growth among major automakers, with a more than fourfold increase in the first half of 2025.

Overall, the UK’s battery electric vehicle (BEV) demand surged 39% to to 47,354 units last month, helping push total new car sales in the UK to 191,316 units, up 6.7% from the same period in 2024.

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EV adoption accelerates, but concerns linger

June marked the best month for UK car sales since 2019, though the SMMT cautioned that growth in the electric vehicle sector remains heavily dependent on discounting and support programs. Still, one in four new vehicle buyers in June chose a battery electric vehicle.

SMMT Chief Executive Mike Hawes noted that despite strong BEV demand, sales levels are still below regulatory targets. “Further growth in sales, and the sector will rely on increased and improved charging facilities to boost mainstream electric vehicle adoption,” Hawes stated.

Also taking effect this week was a new US-UK trade deal, which lowers tariffs on UK car exports to the United States from 27.5% to 10%. The agreement could benefit UK-based EV producers aiming to expand across the country.

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Tesla Model 3 ranks as the safest new car in Europe for 2025, per Euro NCAP tests

Despite being on the market longer than many of its rivals, the Tesla Model 3 continues to set the bar for vehicle safety.

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Credit: Tesla Asia/X

The Tesla Model 3 has been named the safest new car on sale in 2025, according to the latest results from the Euro NCAP. Among 20 newly tested vehicles, the Model 3 emerged at the top of the list, scoring an impressive 359 out of 400 possible points across all major safety categories.

Tesla Model 3’s safety systems

Despite being on the market longer than many of its rivals, the Tesla Model 3 continues to set the bar for vehicle safety. Under Euro NCAP’s stricter 2025 testing protocols, the electric sedan earned 90% for adult occupant protection, 93% for child occupant protection, 89% for pedestrian protection, and 87% for its Safety Assist systems.

The updated Model 3 received particular praise for its advanced driver assistance features, including Tesla’s autonomous emergency braking (AEB) system, which performed well across various test scenarios. Its Intelligent Speed Assistance and child presence detection system were cited as noteworthy features as well, as per a WhatCar report.

Other notable safety features include the Model 3’s pedestrian-friendly pop-up hood and robust crash protection for both front and side collisions. Euro NCAP also highlighted the Model 3’s ability to detect vulnerable road users during complex maneuvers, such as turning across oncoming traffic.

Euro NCAP’s Autopilot caution

While the Model 3’s safety scores were impressive across the board, Euro NCAP did raise concerns about driver expectations of Tesla’s Autopilot system. The organization warned that some owners may overestimate the system’s capabilities, potentially leading to misuse or inattention behind the wheel. Even so, the Model 3 remained the highest-scoring vehicle tested under Euro NCAP’s updated criteria this year.

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The Euro NCAP’s concerns are also quite interesting because Tesla’s Full Self-Driving (FSD) Supervised, which is arguably the company’s most robust safety suite, is not allowed for public rollout in Europe yet. FSD Supervised would allow the Model 3 to navigate inner city streets with only minimal human supervision.

Other top scorers included the Volkswagen ID.7, Polestar 3, and Geely EX5, but none matched the Model 3’s total score or consistency across categories. A total of 14 out of 20 newly tested cars earned five stars, while several models, including the Kia EV3, MG ZS, and Renault 5, fell short of the top rating.

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Why Tesla’s Q3 could be one of its biggest quarters in history

Tesla could stand to benefit from the removal of the $7,500 EV tax credit at the end of Q3.

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(Credit: Tesla)

Tesla has gotten off to a slow start in 2025, as the first half of the year has not been one to remember from a delivery perspective.

However, Q3 could end up being one of the best the company has had in history, with the United States potentially being a major contributor to what might reverse a slow start to the year.

Earlier today, the United States’ House of Representatives officially passed President Trump’s “Big Beautiful Bill,” after it made its way through the Senate earlier this week. The bill will head to President Trump, as he looks to sign it before his July 4 deadline.

The Bill will effectively bring closure to the $7,500 EV tax credit, which will end on September 30, 2025. This means, over the next three months in the United States, those who are looking to buy an EV will have their last chance to take advantage of the credit. EVs will then be, for most people, $7,500 more expensive, in essence.

The tax credit is available to any single filer who makes under $150,000 per year, $225,000 a year to a head of household, and $300,000 to couples filing jointly.

Ending the tax credit was expected with the Trump administration, as his policies have leaned significantly toward reliance on fossil fuels, ending what he calls an “EV mandate.” He has used this phrase several times in disagreements with Tesla CEO Elon Musk.

Nevertheless, those who have been on the fence about buying a Tesla, or any EV, for that matter, will have some decisions to make in the next three months. While all companies will stand to benefit from this time crunch, Tesla could be the true winner because of its sheer volume.

If things are done correctly, meaning if Tesla can also offer incentives like 0% APR, special pricing on leasing or financing, or other advantages (like free Red, White, and Blue for a short period of time in celebration of Independence Day), it could see some real volume in sales this quarter.

Tesla is just a shade under 721,000 deliveries for the year, so it’s on pace for roughly 1.4 million for 2025. This would be a decrease from the 1.8 million cars it delivered in each of the last two years. Traditionally, the second half of the year has produced Tesla’s strongest quarters. Its top three quarters in terms of deliveries are Q4 2024 with 495,570 vehicles, Q4 2023 with 484,507 vehicles, and Q3 2024 with 462,890 vehicles.

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