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Tesla Motors can't email customers, says North Carolina law

A new law passed by the North Carolina state Senate would apparently make it illegal for Tesla Motors to e-mail its customers, Voelcker writes. The law is an effort to prevent what the North Carolina Automobile Dealers' Association terms 'unfair competition' by Tesla Motors.

By John VoelckerGuest blogger / May 17, 2013

View of the interior of the Tesla Model S at the 2013 North American International Auto Show in Detroit, Mich. Tesla Motors currently displays its electric cars at company-owned showrooms, and completes sales online directly with buyers.

James Fassinger/Reuters/File

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How far will state car-dealer associations go to prevent Tesla Motors from opening its electric-car showrooms and selling cars over the Internet?

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A long, long way.

In North Carolina, a new law passed by the state Senate would apparently make it illegal for Tesla to e-mail its customers.

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In other words, if you're a North Carolina resident who has a question about Tesla, the new law may prohibit Tesla Motors [NSDQ:TSLA] from responding to your question via e-mail. 

The specific wording of the law bars automakers from "using a computer or other communications facilities, hardware, or equipment" to sell or lease acar to anyone in North Carolina.

Even telephones?

This seemed rather remarkable to us, so we asked Tesla communications director Shanna Hendriks if we were understanding the law correctly.

"That is not an unreasonable interpretation of the law," she said.

"Any communications device--including a telephone--could be captured as conducting sales activity, and [its use] prohibited except by franchise dealers."

Hendriks concluded: "As you can see, they are trying to tie our hands as much as possible to ‘protect thecustomer'."

Tesla: "unfair competition"?

Diarmuid O'Connell, vice president of business development for Tesla, told ABC News the bill was a "fundamentally protectionist effort to lock down the market and force us to sell through the middle man."

The bill must be sent to the state's House of Representatives by today, and would have to be passed by that body and signed into law by governor Pat McCrory to take effect.

The law is an effort to prevent what the North Carolina Automobile Dealers' Association terms "unfair competition" by Tesla, which so far has sold about 10,000 cars globally since 2008.

The bill would modify a law passed in the mid-1970s to protect existing franchised dealerships against competition from dealers owned by car companies, which could be given preferential treatment by the makers.

No franchisees to be protected

Tesla, however, has no franchised dealers. It currently displays its electric cars at company-owned showrooms, and completes sales online directly with buyers.

The NC dealer group wants to force Tesla to sell only through franchised dealers, who Tesla believes cannot adequately advocate for electric cars because they now derive all their profits from selling and servicing gasoline cars--a technology Tesla competes against.

The case that such laws are in the car buyer's own best interests--and the best way to protect customers--can be seen in comments by Tim Jacksonof the Colorado Automobile Dealers Association.

Some supporters

Tesla and its products are not without supporters in the Tar Heel State. There are 49 Tesla cars registered in North Carolina, and the company operates a service center in Raleigh, but it currently has no stores.

Citizens dismayed at the law had actually set up a private website, called Tesla Motors NC, to rally efforts around preventing passage of the law.

So if you're a North Carolina resident with a question about the 2013 Tesla Model S that only its maker can answer, you perhaps should plan to write Tesla a letter.

You know, the old-fashioned kind. Printed out and inserted into an envelope. With a postage stamp.

Unless, of course, the NC dealer association should conclude that the U.S. Postal Service is a "communications facility" too.

 

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