State laws have long barred automakers like Ford and Volkswagen, which have independent dealer networks, from selling cars direct to consumers.
But that old way of doing things faces more and more questions these days, particularly in a world where people can buy almost anything they want online and have it delivered straight to their homes.
Given that almost everything else can be bought without a middleman, people wonder why not cars, too? It would not only be more convenient, but it should help reduce costs, since the middleman inevitably needs a little share of profit, too.
Scout Motors is the latest in a string of new automakers seeking to challenge the old franchise model in place since the 1930s, and fans of this iconic American brand recently revived are cheering. They’re tired of salesman shenanigans and dealer markups, and ready to buy straight from the source.
Monopoly Fighting Tool
Scout Motors is a wholly owned Volkswagen subsidiary, however, and that’s the first fly in the ointment to dealers.
If VW, which has an established network of independent dealers, can simply bypass its contracts with dealerships by setting up an independent subsidiary, then what’s stopping Ford, Chevy, and other automakers from doing the same?
Dallas Tyrrell, manager of Tyrrell Chevrolet in Cheyenne and President of the Wyoming Auto Dealer Association, said the modern dealership system is a monopoly-fighting tool. He believes that still has value in the modern world.
“At one point, General Motors had 73% of the market share and vehicle sales,” Tyrrell said. “So, this was a way to break up some of these very large companies.”
But beyond that, he doesn’t believe selling direct to consumers has many protections for consumers.
“Especially with a company like Scout, no one knows who they are,” he said. “There’s no long-standing relationship with the community. A car is someone’s second — the first is usually the house — largest purchase in a lifetime. So, they don’t want you to come in, spend that kind of money, and then have no way of maintaining it or servicing it.”
Scout Motors says buyers are tired of dealership markups and dealing with salesmen, which is why the company wants to sell its popular SUV and truck direct. Dealerships, however, warn that’s risky when it comes to service and support. (Scout Motors) 
Scout Motors says buyers are tired of dealership markups and dealing with salesmen, which is why the company wants to sell its popular SUV and truck direct. Dealerships, however, warn that’s risky when it comes to service and support. (Scout Motors) 
Scout Motors says buyers are tired of dealership markups and dealing with salesmen, which is why the company wants to sell its popular SUV and truck direct. Dealerships, however, warn that’s risky when it comes to service and support. (Scout Motors)
Tesla Has Service Problems
Tyrrell has heard EV auto manufacturers complain about the dealership system before, but so far without much success, at least in Wyoming.
“When Tesla tried to sell direct to the consumer here in Wyoming, we opposed that because there’s a lot of infrastructure that goes into it,” he said. “You have to have a service center. You have to have the crew here locally that can handle that type of business. So, obviously, there’s a lot of investing that goes on.”
Scout, he feels, has added nothing new to the argument, and, with Tesla failing to make its case in Wyoming, he doesn’t believe Scout will fare any better in the Cowboy State.
Tesla, Tyrrell added, has had a ton of service issues, which he believes illustrates his point about protection for consumers. He believes that lack of service has also contributed to that company losing market share.
“It’s interesting (what Scout) is trying to do,” he said. “But (direct selling) is not in the best interest of the customer.”
Colorado dealers, meanwhile, have filed suit to challenge Scout’s license, arguing that if Scout is allowed to do that, there will be nothing to stop other auto manufacturers from following suit. That would invalidate a longstanding way of doing business in America, and make their contracts with those dealers much less meaningful.
Production Set For 2027
Scout Motors acquired International Motors in 2021 and relaunched its Scout brand in 2022, reimagining the line as off-road electric vehicles. More recently, they’ve added an option for a range extender, which is a small gas engine that helps keep the battery charged while driving.
Production of new Scout electric vehicles is set for late 2027, at a $2 billion manufacturing facility in South Carolina.
The revival of the iconic Scout brand was greeted with enthusiasm across the country, despite questions from some enthusiasts about whether an off-road EV really makes sense.
One of the factors potential Scout customers say they like is the option to skip the entire dealership experience.
“I don’t like salesmen,” Colorado Scout enthusiast Brian Tucker told Cowboy State Daily. “I don’t want to go in and visit with someone and say, ‘Ok this is what I’m looking for,’ — and this is recent for me. I have looked for a new vehicle, and I gave one dealership my phone number and now I get a call about every three weeks.”
That’s despite Tucker telling the salesman multiple times now that something has come up that he will call back when ready.
“Just yesterday, he called from a different phone number,” Tucker said. “And he said, ‘Well, I’m just checking.’ I don’t need to explain my financial situation to (him). I mean, I don’t have to explain, and I shouldn’t have to explain myself for him to stop calling. So, I think what Scout Motors is trying to do is phenomenal. They’re trying to take the pressure out of sales. They’re trying to make it where you can go online.”
Service Centers Are Planned
Tucker, who is a Scout collector and already owns more than 10 of them, plans to buy one of the models with a range extender.
“That way I’m not dependent on having to go plug it into the wall to charge,” he said. “I can just fill up the fuel tank and keep driving.”
Tucker said his understanding, so far, is that Scout plans to have service centers for repairs throughout the territories where it’s selling the car, so he’s not worried about access to mechanic services that dealerships typically provide. His only sticking point is whether there will be somewhere he can go, within at least 100 miles, to test drive a Scout before buying one.
“Actually, you might be able to go to a mall to look at one of these and place your order,” he said. “But you don’t have a salesman. You don’t have to deal with salesmen or anything like that, and they’re supposed to have service centers where they can do the repairs and maintenance or whatever may be needed at various locations throughout the United States.”
Take It From A Former Car Salesman
Nick Feist, a longtime Scout enthusiast also in Colorado, meanwhile, has no plans to buy one of Scout Motor’s new EVs. He doesn’t believe any EV can live up to his expectations for an off-road vehicle.
“We take off roading trips and we’ll be gone for a week,” he said. “We’ll run through the entire Rocky Mountains, and we’ll do it on trail, without going through any kind of paved road or town … How are you going to do that in one of those? Because you’re going over obstacles and going up 13,000 feet and back down. That’s going to be a lot of drag, and it’s in four-wheel drive and low range, so it’s a lot of drag on that battery.”
There’s also no thrill to driving an EV, Feist added.
“Yeah, sure, they’ve got a lot of torque, and they can take off fast, which is kind of fun,” he said. “But I know what it’s like to drive a 69 SS 396 Camaro and really cool cars that have a lot of soul and a lot of rumble and a lot of excitement.”
Hearing all the gears whining as he goes through them and the roar of the engine is all an integral part of the driving experience for him.
“I want to see and experience the vehicle that I’m in and not feel like I’m just riding around in a computer,” he said.
But Feist is glad to see someone revive his favorite brand and he does like what Scout Motors is trying to do with direct-to-consumer sales. So, if the company ever offers a gasoline-powered model? He’s all in on buying one for his personal collection of Scouts — as long as he doesn’t have to go to a dealership to do it.
“I’ve never bought a car from a dealership in my life,” he told Cowboy State Daily. “But I have sold out of them.”
From that experience as a salesman, he knows all of the “shenanigans” that get played on consumers, and he won’t let himself be subject to any of it.
“I don’t want to pay a salesman commission, and I don’t want to pay a dealer markup,” he said. “I’d rather buy the vehicle from (the manufacturer) for what they want, and be able to go — I mean what a cool experience it would be to be able to go to the manufacturing plant and get a tour of them being built in the manufacturing process, and, at the end of the tour, I sign all my paperwork and take mine home.”
Renée Jean can be reached at renee@cowboystatedaily.com.
