The world’s hottest brand in electric automobiles is planning to open one of its chic Tesla Motors Stores a few blocks from Parliament Hill.
The store’s location, which will be near the corner of Metcalfe and Albert streets according to the company’s website, was revealed recently, however an exact address is not yet available. The page showing the location promises more information is “coming soon.”
Screen grab for Tesla Ottawa website showing location of where their new store will be
Repeated attempts to reach officials from Tesla were unsuccessful on Tuesday. The company is well known for its secrecy and rarely responds to media requests.
The area where the store is supposed to open is already crowded. The block is home to the Capital Hill Hotel & Suites as well as a building housing federal government workers. However, Tesla Stores are typically small, boutique-like shops that rarely exceed 1,500 square feet.
The company’s largest store in North America is in Montreal, a 45,000-square-foot shop on the site of an old Chrysler dealership on Ferrier Street. That location also includes a service centre. There is an 18,500-square-foot sales centre in Vancouver’s posh Kitsilano neighbourhood.
The vast majority of Tesla Stores are not like traditional car dealerships with acres of inventory, large showrooms and service and repair areas. Tesla showrooms are normally small and often sell Tesla branded products, like mugs and scarves. Unlike traditional franchisee car dealerships, Tesla locations are owned by the manufacturer. That has caused controversy in the United States, where dealers’ associations have argued the stores should be independently owned and operated.
Besides the Montreal and Vancouver stores, Tesla has outlets in Toronto’s Yorkdale Mall and another in the Chinook Centre mall in Calgary. It also has a network of rapid charging stations across the country and says it is preparing to unveil charging station at the Brookstreet Hotel in Kanata and at Canada Aviation & Space Museum.
Barry Nabatian, director of market research at Shore Tanner & Associates, said that with Ottawa’s economy still sluggish, the average buyer for a new vehicle is looking to spend around $38,000, a far cry from the $100,000 or more Tesla is asking for its vehicles. The company plans to offer a new Model III this year that will carry a $35,000 U.S. price tag, but production won’t start until sometime in 2017.
Nabatian said the company will likely see annual sales of 300 to 400 vehicles.
“The downtown store is likely for maximum exposure,” said Nabatian, who questioned why the company isn’t opening its store closer to Ottawa’s technology hub in Kanata. “It would, in my opinion, be a mistake to not open their show room or dealership in the Kanata/Stittsville area. At those prices and given the novelty, I’d expect that potential Ottawa buyers would demand to see the models and test drive, etc.”
However, Kenneth Wong, associate professor of marketing at Queen’s University’s Smith School of Business, said that isn’t the way Tesla operates.
“A consumer looking to pay over $100,000 isn’t the type of consumer that goes out to Kanata and browses around a parking lot,” he said. “The consumer who wants a Tesla wants a Tesla. They aren’t kicking the rubber and comparing models.
“When they arrive in the show room their decision is basically made.”
Wong also said the federal government’s recent interest in green energy initiatives and environmental policy might have played a role in attracting the company to the nation’s capital, and especially to a location a five- minute walk from the House of Commons.
“It’d be interesting to know if Tesla would have picked Ottawa for its next location, and that particular site, if the Liberals hadn’t won the election,” he said. “We have a prime minister looking for a high-efficiency, carbon-free economy. The timing is almost too coincidental.”
