Scout Motors Refuses To Back Down On Plans To Cut Dealers Out Of The EV Equation

Dealers suck, so when Scout Motors announced plans for a direct sales model that cut out existing dealers, you knew it was only a matter of time before those dealers tried to make Scout change its mind. And wouldn’t you know it — that’s exactly what happened. In the most predictable move ever, dealers pitched a fit. But Scout didn’t back down then, and from the sound of it, the continued dealer temper tantrums haven’t changed that. In fact, Scout CEO Scott Keogh used his recent Munich motor show appearance to double down on direct sales, InsideEVs reports.

Scout didn’t exactly need to be at the Munich show, since neither the Terra nor the Traveler will be available in Europe once production begins (a point Keogh reiterated at the press conference), but since Scout is part of Volkswagen Group, it apparently saw the show as a way “to tell our story to the global press.” And that story does not involve greedy middlemen driving up the price of the car you want so they can buy a fancier boat and donate to the worst politicians in your state.

Addressing members of the media, Keogh spoke about how important a direct sales model is to Scout’s future, saying, “If you look at 21st-century brands and what they’re able to deliver, that’s what they do. We can create the stores, and we can create the brand experience.” 

Of course, as InsideEVs points out, dealers have already done a lot more than complain about Scout’s direct sales plans. A group of Volkswagen and Audi dealers sued in Florida, with another lawsuit coming from the California New Car Dealers Association. How Scout, which never signed an agreement with any dealerships, could have violated the terms of a contract that doesn’t exist isn’t entirely clear. But the lawsuits are real and still working their way through the courts.

According to Keogh, though, he has no plans to let a few grumpy dealers change his mind. “I’m quite clear on this front,” he told the media. “This is the right strategy. You have to do it right for the consumer, and America likes a business that can compete and challenge and innovate… it’s a lot of noise.” He later added, “If you don’t own the relationship to the customer, what exactly do you have? You’ve got the factory and you’ve got all the costs. You don’t have all the optimization on that front.”

If I’m being completely honest, I just assumed Volkswagen Group (and therefore Scout) would eventually cave to dealer pressure, even after they initially pushed back. Ultimately, we’ll have to see how the lawsuits play out, but I’m legitimately impressed they still aren’t backing down. Of course, we’re also talking about vehicles that don’t actually exist yet, so they’ll need to actually build a few first and make sure the range-extender works properly before we can get too excited. Still, at least for now, Scout continuing to stand up to dealers can only be read as a good thing.