Electric car manufacturer Tesla is closing its showroom on Oxford Street, W1, just a year after opening, as it is unable to adapt the store to its retailing ambitions.
The American auto firm agreed a deal for the 3,000 sq ft space at 449 Oxford Street, W1 on a 10-year lease in 2015 for a rent of around £1m pa.
However, it has decided to close the shop ahead of the launch of new products. At 3,000 sq ft, the space is only large enough to display one car. Tesla has two models – the Model S and Model X – and is launching a third in 2018, so will likely be looking for a larger showroom where it can display more than one car as well as related products such as its solar powered car charger, the Powerwall.
The Oxford Street shop sits within a Tribeca Holdings-owned block opposite Selfridges and is classified under planning conditions as A1 general retail. Tesla applied to Westminster City Council to have the use changed to sui generis but the application was refused in January.
It is likely that Westminster did not want to change the building’s use to sui generis – the overarching condition that allows not just showrooms but casinos and nightclubs – to prevent leisure occupiers taking the space in future.
Instead a deal has been agreed with Swiss watchmaker Tag Heuer to take on the remaining nine years on the lease. This will be the LVMH-owned brand’s first standalone shop in central London and its fifth in the UK following its boutiques in Manchester and intu Lakeside, Essex. The watch shop will sit alongside Omega and Watches of Switzerland which also have flagship stores in Tribeca Holdings’ corner block.
Following the closure of the Oxford Street store, Tesla is likely to look for a replacement central London location where it can display its full range.
In the company’s latest Q1 shareholder letter it said that it is looking to open 100 retail, delivery and service locations globally in order to meet its target of producing half a million cars by 2020.
Tesla was one of the first car brands to move away from out-of-town showrooms onto high street premises, to offer customers a more interactive experience. It opened at Westfield London in 2013.
It now has 16 showrooms in the UK following the opening of new sites in Cambridge and Cabot Place, Canary Wharf, E14, this month. Its third electric car, Model 3, will be available in the UK by the end of 2018.
CBRE and Savills represented Tesla.
Tesla in numbers
2003 – founded by engineers in Silicon Valley
2012 – launched its first model, Model S
16 UK stores, including London, Birmingham and Manchester
7 ‘service plus’ garages for repair and maintenance
4 garages include on site stores
250 retail and service stations worldwide
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