Virginia Goes After Tesla Motors Over Bird Dogging Laws

The practice of bird dogging is outlawed in Virginia. One party that isn’t licensed to sell vehicles cannot be compensated for a referral that results in a sale. That type of situation is exactly what Tesla introduced in their new owner to potential-owner program. Under Tesla’s new program any Model S owner can refer another person for $1,000 off a new Model S sedan. The owner in return receives $1,000 toward upgrades or Tesla service. The Motor Vehicle Dealer Board in Virginia immediately responded to Tesla’s new initiative.

In a Bloomberg report, Bruce Gould, executive director of the Virginia State Dealer Board said, “If Tesla is compensating current owners $1,000 for selling a Model S to their friends, they are out of compliance. If a Ford dealer was giving out dinner coupons to customers for referring their friends, we’d say the same thing. What’s the difference between selling a vehicle and convincing someone to buy a vehicle? There has to be a line.”

In response to the Tesla deal being against the law in Virginia, the California-based automaker is modifying their offer. Model S owners are still allowed to offer someone a link to save on a new Model S, however, it’s now $2,000 instead of $1,000. That means that those giving out the discount will receive no compensation and will instead rely on their desire to evangelize the electric car company. Tesla doesn’t agree with changing their program to fit one state, but they are.

Ricardo Reyes, a Tesla spokesman told Bloomberg in a statement, “This law was enacted a long time ago to prevent rogue salespeople, not for preventing friends from recommending products they love.” Furthermore in a letter to Model S owners in Virginia, Tesla said, “Our Referral Program was never designed to make you a salesperson. Nevertheless, due to the position taken by Virginia regulators, we are making one change to our Referral Program for our customers in Virginia.”

What is your take? Is the new Tesla referral program an example of bird dogging? Should the automaker have to change their referral program in other states to prevent a bird dogging situation? Do you believe Tesla when they say that the program isn’t intended to create salespeople out of current vehicle owners?