US: Tesla initiates its first incentive program for current owners image

Tesla Motors, the youngest publicly traded US automaker, has decided to compensate with $1,000 any owner or buyer of the Model S sedan that use the traditional word-of-mouth referral practice.

Chief executive officer Elon Musk, also the company’s billionaire entrepreneur and co-founder, announced the new referral bounty would be targeted at those who purchase a new Tesla electric sedan and those who refer them – until October 31. The top executive added the program, if turns out successful, could also be extended to the sale of used autos. The referral program is not a traditional move among automakers, though it’s also not unheard of for the franchised dealers as well. Musk said during a conference call with media representatives the referral program should also act as “a guerilla tactic against car dealers in certain states” that go against Tesla’s practice of selling its premium electric autos directly to consumers, without the assistance of a franchised dealer.

Tesla does not use any type of franchised dealers and owns and operates its own showrooms – called stores – and also doesn’t engage in advertising and marketing, though the latter policy might be subject to a revision in the future, added the CEO. Musk also said the additional cost of selling a Model S sedan though its own stores was of $2,000. “If we can amplify word of mouth, then we don’t need to open as many new stores in the future,” he commented in an open letter to Tesla customers that announced the introduction of the referral strategy.

Via Reuters