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Car Dealers vs the Web: GM Shifts Toward Online Purchasing

Soulskill posted about a year ago | from the do-you-see-which-way-the-wind-is-blowing dept.

Businesses 160

cartechboy writes "Car dealers may be in for a new battle, and it turns out existing car manufacturers are joining the fun. Tesla Motors began the rebellion by trying to sell electric cars directly to buyers. Car dealers have fought that effort state-by-state and even complained to the DMV about Tesla's website. But things just got a little more interesting. General Motors announced plans to expand its new web-based shopping tool (aka a shopping web site) that allows customers to bypass showrooms when buying new cars. The idea is to use the Web as a giant test platform to see if the automaker can better target people who use the web to buy things. The catch is that the web app, called 'Shop-Click-Drive' will allow users to do almost everything they'd do at a dealer: customize the car, get pricing and financing and even arrange for delivery. But then when you push the button, your "purchase" will be routed to GM's network of 4,300 dealers, so you still have to visit a local dealer to sign on the dotted line. Even with this limitation, the move is still making dealers nervous. GM dealers aren't required to participate in the web-based test, and company officials say they have had some dealers turn it down."

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This just in... (0)

girlintraining (1395911) | about a year ago | (#45076803)

GM is functionally incompetent when it comes to the internet. Tesla is new, small, agile, and responsive to the market. GM is still stuck on the couch with its hand in the chip bag, bitching about how easy kids have it these days.

Get off the couch GM, lose 50 pounds, and divorce yourself from the idea that you're owed something. Keep it up and this new generation that seems to have little interest in cars, preferring to bike everywhere and sees no particular status in owning a new car will put your fat ass outta business.

Re:This just in... (1)

DaHat (247651) | about a year ago | (#45076833)

Fat or not, agile or not... it's sure a heck of a lot easier (and cheaper) to buy a GM vehicle than it is a Tesla. GM dealerships are near everywhere (as is their quick fueling options)... not so much with Tesla.

Don't get me wrong... Tesla has a great bit of tech behind them, they are still the new comer and have a great deal of mindshare to win with regards to 'the big three'.

Re:This just in... (-1, Redundant)

Anonymous Coward | about a year ago | (#45076947)

I will get you wrong.

Re:This just in... (2)

girlintraining (1395911) | about a year ago | (#45077435)

Fat or not, agile or not... it's sure a heck of a lot easier (and cheaper) to buy a GM vehicle than it is a Tesla. GM dealerships are near everywhere (as is their quick fueling options)... not so much with Tesla.

Yeah... that couldn't be because of political pressure to deny them permits [hybridcars.com] , could it? Great argument you got there.

Tesla has a great bit of tech behind them, they are still the new comer and have a great deal of mindshare to win with regards to 'the big three'.

You say that like they're all playing the same game, and under the same rules. You couldn't be more wrong.

Re:This just in... (2)

DavidClarkeHR (2769805) | about a year ago | (#45076861)

GM is functionally incompetent when it comes to the internet. Tesla is new, small, agile, and responsive to the market. GM is still stuck on the couch with its hand in the chip bag, bitching about how easy kids have it these days.

Get off the couch GM, lose 50 pounds, and divorce yourself from the idea that you're owed something. Keep it up and this new generation that seems to have little interest in cars, preferring to bike everywhere and sees no particular status in owning a new car will put your fat ass outta business.

GM will continue to survive until it is forced to compete in real capitalism.

But hey, I'd rather car-shop online, and if that is EVER going to happen, law-makers have a vested interest in the success of GM (an "american" institution). Not so much in Tesla.

Re:This just in... (1)

LandDolphin (1202876) | about a year ago | (#45077297)

So forever?

Military-Industrial (3, Interesting)

Etherwalk (681268) | about a year ago | (#45077301)

GM will continue to survive until it is forced to compete in real capitalism.

Never. Going. To. Happen.

GM will compete and be productive, but it will also be propped up by DC for decades beyond its viable life because it is a critical American manufacturer in terms of raw industrial output. And raw industrial output wins almost any prolonged non-WMD war.

Re:This just in... (3, Interesting)

icebike (68054) | about a year ago | (#45077577)

But hey, I'd rather car-shop online, and if that is EVER going to happen, law-makers have a vested interest in the success of GM (an "american" institution). Not so much in Tesla.

Everybody car shops on line. They read the specs, pick the model, look at prices, and maybe get a few quotes. Very few people actually order on line. (Women tend to do this more than men, but then women buy more than half the vehicles sold in the US).

I'm not willing to spend 25 or 50k on a strictly on line purchase. If I bought a Tesla I'd do the same on line shopping but I'd STILL go find a showroom/service center. (I'd have to drive to Seattle). I'm Not dumping that kind of money on the net, and having it show up wrong, dented, or what ever with out a local-ish resource.

Re:This just in... (1)

dead_user (1989356) | about a year ago | (#45077931)

I'm with ya. I won't buy shorts on the internet because I loathe wasting money on shipping something back when it's not what I wanted. Wrong size, wrong color, . I can't expect the carrier to cover it. They did their job. I'm asking them to do it again. The seller sold me what I asked for. Now what do I do with them? Any way you slice it I feel like an asshole who should have just gone to the store and tried some on. No one to blame but myself.

There is no way I'm shipping back a car because the blue finish on my monitor looks nothing like the blue in reality.

A service center serves a definite purpose. I'm... Old. I've bought 3 cars in my life. My current car will be old enough to get its own learners permit next year. Dropping that kind of money is a big deal to me, especially since last time I did it, I dropped $16,000. Cars are twice that now, I NEED a little hand-holding to make sure I'm not totally doing something stupid. I'm willing to pay a professional to make sure all the correct legal paperwork is handled. I want somewhere I can go to when something happens to my car, my fault or theirs. I also need a place where I can go and be guaranteed to get the part I need for my car, even if I pay a small premium. I've been amazed at some of the obscure bits they have had in stock. That being said, I do prefer a mechanic to a dealer for any repairs I can't do myself. Dealerships have a scorched earth policy to vehicle repair. Two years after I bought it, my car developed a steering fluid leak due to the high and low pressure power steering lines being too close and at cross angles vibrating holes in each other. Ford wanted $600-$800 to replace the power steering system. The mechanic I took it to fixed it with a brazing torch and stopped the vibration with some cut rubber hose and a zip tie for $20. That was 12 years ago and I haven't had a power steering leak since. Sure the for way would have fixed it, but it's just a tube guys. Replace the tube, not the whole engine. /rant

Re:This just in... (1)

girlintraining (1395911) | about a year ago | (#45077997)

I'm Not dumping that kind of money on the net, and having it show up wrong, dented, or what ever with out a local-ish resource.

Okay dude, seriously... if you drop 25-50k on a car, do you honestly think the company cares so little for your purchase, when it's so small and desperate for customers, that it's going to just flip you the bird? No. They'll send the goddamned engineers who built that car on the next flight to your house to personally buff and shine that fucker. So please; Don't insult everyone's intelligence here by suggesting that is any kind of a possibility. Amazon provides better customer service than that when I buy a pair of shoes off their website.

No. This is about convenience, and human psychology. If you're going to be spending an hour or more a day inside that metal can on wheels, you want it to be comfortable. You want it to be easy. Satisfying. And you can't satisfy those emotional needs unless you sit in the damn thing first and drive it around. That's why you go to the dealer -- to test drive. Find out if you find the car... suitable. No other reason. I bet if Tesla had lots in every major city where you could just show up, test drive it, then bring it back... and that was it, no dealers, no pressure, no bullshit... and everything else was done online, you'd pony up the 25-50k. You'd do it because then you'd know what you're getting.

But don't say it "show up wrong, dented or what ever" is really a serious hinderance in the buying process.

Re:This just in... (5, Informative)

berashith (222128) | about a year ago | (#45077183)

the last car i bought, 5 or 6 years ago, i considered a GM car. I had just gone through a great experience buying a honda for my wife, then GM came along to show me how miserable a shopping experience could be. There were a couple of options that made me want this car, but then I couldnt figure out how to get them. The salesman just wanted me to pick one off the lot, but they were over priced with options i didnt want, or didnt have what i came for. We looked at how to order the car, but the items all came in bundles... piles of bundles. One might have a sunroof, a certain radio, upgraded rims, and memory seat adjustments. of these I wanted the sunroof. Then you pick a different engine, and it changes the rims and radio and carpet, and you arent sure which set of overlapping choices would end up on the car. No one could figure that out. This happened for every option i wanted.

I then tried to configure on a website. again the options were a joke of complexity. At the end, I got to choose which dealership would contact me with a quote. I could choose 1, and only 1. I wanted to see what competing quotes might get me, but I had to start the entire order process over. This was going to take too much time, so I bought a Nissan.

Re:This just in... (1)

emaname (1014225) | about a year ago | (#45077331)

I SO badly want to give you a megaton of mod points.

The earlier comments re how GM is out of shape are spot on, too.

I won't buy their products.

Re:This just in... (2)

Phoeniyx (2751919) | about a year ago | (#45077307)

You were on a roll, until you just said this crazy thing: " Keep it up and this new generation that seems to have little interest in cars, preferring to bike everywhere"

Re:This just in... (1)

Ralph Ostrander (2846785) | about a year ago | (#45077393)

As I go get a new vette.

Re:This just in... (4, Insightful)

icebike (68054) | about a year ago | (#45077465)

GM is functionally incompetent when it comes to the internet. Tesla is new, small, agile, and responsive to the market.

Well Tesla has, what, one model, with very few options available. More coming, sure, but today, its pick your color and battery size, and send a check.

With any of the other big manufacturers, the combinations are almost endless. Engines, transmissions, rear ends, tires, interior trim, exterior trim, across maybe 10 or 30 models. Its a whole level of scale. They have never been set up to do this on a massive scale. Even the dealers need hand holding when ordering cars. Dealers typically order from a pick list of pre-configured models, of what they think will sell in their area.

When you come kicking tires, if they can't find a car you want on their lot, they might check other dealers, but sooner or later you end up settling for something handy or going for a custom order. And custom orders aren't quick through any of the big dealers. It can take a couple months easily, and if you are near the end of a model year you are SOL. So most people settle for what's on the lot.

Tesla was set up from the beginning to custom build from a SMALL selection of models. Detroit was set up to pre-build bazillions of standard models with a very few custom orders.

Still you have to give them credit for trying. You can already "custom build" by picking package options from most manufacturers. (Not with anywhere near a desirable level of granularity.) But you are going to go through a dealer somewhere along the line.

Re:This just in... (1)

girlintraining (1395911) | about a year ago | (#45077969)

Well Tesla has, what, one model, with very few options available. More coming, sure, but today, its pick your color and battery size, and send a check.

Consider what they're up against: GM isn't just on the Fortune 500, or even the Fortune 100. They are in the Fortune, uhh... 5. This is a massive corporation, one deemed by our own government as "too big to fail". They have an extensive network of lobbyists. Do you know how many times Tesla has tried to get stores opened only to be denied by state and federal law -- passed very recently and at the behest of GM? Google "Tesla permit" ... then shit a fat brick. You wonder why they only have a website? It's because that's the one thing they don't need approval from these paid off politicians to get going. And... SURPRISE! Guess what the next thing GM wants to do is: Make buying a car online functionally illegal. They're real close to doing it too.

Now when you're pissing in the wind against that kind of a political power player... how much money do you think they're blowing just to keep their head above water in that department? A fuck ton. They'd love to give you a dozen new models. They could too... except every last dime is dedicated to surviving the regulatory onslaught GM has orchestrated. GM has spent more on campaign contributions this year than Tesla has ever made from all of its sales. Ever.

Still you have to give them credit for trying. You can already "custom build" by picking package options from most manufacturers. (Not with anywhere near a desirable level of granularity.) But you are going to go through a dealer somewhere along the line.

GM thanks you for your patriotic opinion, Citizen. Our extensive network of exclusive dealerships really is the only way to shop.

Re:This just in... (0)

Anonymous Coward | about a year ago | (#45077849)

>Keep it up and this new generation
It's probably just you.

>that seems to have little interest in cars, preferring to bike everywhere and sees no particular status in owning a new car will put your fat ass outta business.
And Tesla too!

Good riddance ... (2)

MacTO (1161105) | about a year ago | (#45076829)

I hope that GM and other manufacturers go all of the way with online sales. Car dealerships consume an absurd amount of commercial realestate, and it is frequently prime commercial realestate.

Re:Good riddance ... (4, Insightful)

malignant_minded (884324) | about a year ago | (#45076871)

I just bought a car after driving several. How would online options really help with determining what has good feel/performance for a customer. Some people like to feel the road others like a smooth ride. The terrible blutooth integration with my purchased car (though I dont think many cars support Google commands/Siri) makes me wish I played with it more at the dealership instead of just trying to make a call. Colors look different in daylight. Some plastics feel cheaper than others, the list goes on and on. You must have bought something online, opened the box and went "ugh I thought it looked different" So why would you want to put down so much on a car only seen online?

Re:Good riddance ... (3, Insightful)

houstonbofh (602064) | about a year ago | (#45076919)

I am with you. I am 6 foot tall, and all torso, no leg. So some cars I just do not fit in. At all... The only way to know is a test drive, and that does require a lot of some kind.

Re:Good riddance ... (2)

DaHat (247651) | about a year ago | (#45077125)

I'm 6'5" and plenty of both... as currently my wife requested brochures on a number of vehicles and trying to sell me on this feature or that... I remind her that regardless of any other facts or features... my primary deciding fact is which do I fit in comfortably, everything else is secondary.

I've spent a lovely 10 years with my Pontiac Aztek... and fear the day that it dies (or requires more to keep running than I could buy something new(er) for)... as I've found few things that are not full size SUVs that fit me well.

Re:Good riddance ... (5, Funny)

Anonymous Coward | about a year ago | (#45077173)

So YOU are the one guy that bought it!

Re:Good riddance ... (-1)

Anonymous Coward | about a year ago | (#45077169)

Buy a tractor for your fat body to ride in then?

Re:Good riddance ... (1)

houstonbofh (602064) | about a year ago | (#45077463)

Buy a tractor for your fat body to ride in then?

So you work for GM? (Based on how poorly some fun GM cars fit me, yet a Suburu fits me well...)

Re:Good riddance ... (2)

cascadingstylesheet (140919) | about a year ago | (#45077019)

You must have bought something online, opened the box and went "ugh I thought it looked different" So why would you want to put down so much on a car only seen online?

Agreed.

I do like to identify a car online - find one of the make and features that I want. My favorite used lot lets me do that on their site, pretty much. But then I do need to go try it out.

Re:Good riddance ... (1)

nelsonal (549144) | about a year ago | (#45077175)

Car dealers aren't going away anytime soon, they are exceedingly influential in local politics limiting auto manufacturers ability to side step them and earn fat commissions. Were it possible, no doubt around 1,000 apple store like super stores would replace most dealers for test drives/car fitting, warranty work, and help anyone who desires it with ordering.

Re:Good riddance ... (3, Informative)

R3d M3rcury (871886) | about a year ago | (#45077177)

How would online options really help with determining what has good feel/performance for a customer.

Depends on how much the customer cares about feel/performance. There are people out there who want basic transportation and aren't all that concerned with the other stuff. When I had a short commute, I didn't really care. When I had a long commute, I bought a new car because if I was going to spend an hour-and-a-half somewhere, I was going to enjoy it.

That said, I agree. However, look at Tesla--they have showrooms [teslamotors.com] where you can check out the cars. They do test drives, though you might have to arrange it in advance--I'm not sure you can just walk in and say, "Hey'd I'd like to test drive a roadster!" So they keep a model or two around for the test drive. You don't need acres and acres of land to park a bunch of cars that you hope to sell.

Re:Good riddance ... (1)

icebike (68054) | about a year ago | (#45077663)

True, but Tesla hasn't got very many models to sell either.

Re:Good riddance ... (0)

Anonymous Coward | about a year ago | (#45076883)

Exactly. Ugly huge lots where you have to worry about getting ripped off. Good riddance. Give me a standardized buying playform...e.g. Amazon should sell cars. GM should partner with them. They have the know how.

Re:Good riddance ... (-1)

Anonymous Coward | about a year ago | (#45076953)

Absolutely right. +1

They do! (2)

Zynder (2773551) | about a year ago | (#45076973)

Amazon should sell cars.

Ask and ye shall receive! [amazon.com]

Re:They do! (1)

beatljuice (735526) | about a year ago | (#45077097)

Can I get Prime (2 day shipping) on that order?

Re:They do! (1)

Zynder (2773551) | about a year ago | (#45077555)

Nope afraid not. Hehe. You actually don't get it from them. It's much like the thing in the article. They get you set up on the Amazon buy, and then you head off to the local dealer to pick it up. It isn't perfect or ideal right now but it's a start.

Re:Good riddance ... (1)

NotQuiteReal (608241) | about a year ago | (#45077089)

Oh, and often a prime source of income for the municipality in which they are located (property and sales taxes...)

Re:Good riddance ... (0)

Anonymous Coward | about a year ago | (#45077123)

Yes, let's replace car lots with shopping centers containing another set of PetCo, Jamba Juice, and Gap stores (or whatever your favorite recurring bunch of soulless stores are...)

Re:Good riddance ... (0)

Anonymous Coward | about a year ago | (#45077317)

Yeah it is really horrible to have a functional business paying state and local taxes while providing a few jobs in the area. GM and Chrysler closed a number of dealerships in the area a few years ago and the property still lies fallow today.

Re:Good riddance ... (0)

Anonymous Coward | about a year ago | (#45077859)

Wouldn't it be more efficient just to charge the state and local taxes directly to the purchaser, rather than requiring a middleman (i.e. car dealership)? As for "functional business" -- what function do they serve that couldn't be met by other businesses (that operate without special legal protections)?

Re:Good riddance ... (1)

icebike (68054) | about a year ago | (#45077635)

I hope that GM and other manufacturers go all of the way with online sales. Car dealerships consume an absurd amount of commercial realestate, and it is frequently prime commercial realestate.

That's an odd objection, since realestate is one thing we don't really have a shortage of.

What would you put in those so call prime commercial realestate? More outlets to sell costume jewelry, handbags, and shoes?

Seriously, most car dealerships take up room, but even in densely populated areas, there is still plenty of space.

government motors (1, Funny)

turkeydance (1266624) | about a year ago | (#45076831)

your car and healthcare combined.

Bring it on (1)

Anonymous Coward | about a year ago | (#45076845)

I tried to buy a new car at a dealer recently and ended up walking out after being messed about and insulted with bait-and switch. Anything that gets rid of dishonest dealing and shoddy sales practices is a good thing. I say bring on direct purchasing ASAP.

Re:Bring it on (1)

houstonbofh (602064) | about a year ago | (#45076929)

I have driven to a dealership that did that to me. In my new car that they did not sell. The sales manager still did not care. Until I asked how to contact the ownership...

Dealers: always more expensive (0)

Anonymous Coward | about a year ago | (#45076847)

People won't pay more than they have to.

Government Motors sells on the internets... (1)

amightywind (691887) | about a year ago | (#45076867)

Ya mean like health insurance?

Yep, buy on the web, at full MSRP. (0)

Anonymous Coward | about a year ago | (#45076913)

Great plan for lazy idiots with more dollars than sense.

Re:Yep, buy on the web, at full MSRP. (4, Insightful)

LandDolphin (1202876) | about a year ago | (#45077311)

The whole "wheeling and dealing" for a car price needs to go away.

This is a GOOD thing (4, Insightful)

jonwil (467024) | about a year ago | (#45076939)

Even though you have to buy from a dealer, this new GM website means you get exactly the car you want with the extras you want at a price that is set before you even set foot on the dealer lot. No negotiating and no up-sell.

Which is exactly why some dealers dont like it.

Re:This is a GOOD thing (2)

postbigbang (761081) | about a year ago | (#45076961)

They have literally millions involved in major businesses and don't want to be cut out of the process, just to run garages with nicely uniformed "technicians". So they have a lot of interest in making Internet sales focused on THEM, which is why they flood Craigslist and other sites, to also do what GM can't do--> deliver today.

If you can wait and circumvent what's been a tawdry sales process, so much the better. If you need alternate financing, delivered-today variety, someone to guide you without chatting with someone in Nova Scotia (no offense intended to my Canadian Friends), they have value. But car salespeople are highly motivated to add-on or add-in, upsell, and do their best to generate financing revenue spiffs for themselves and their dealership.

GM faces a formidable problem that they themselves created long ago: a strong dealer network.

Re:This is a GOOD thing (-1)

Anonymous Coward | about a year ago | (#45077179)

They did not create the dealer network, the government did in response to enticompetitive market behaviour. Once upon a time all car manufacturers owned their own dealerships. That was done away with to protect the consumer.

Re:This is a GOOD thing (2)

postbigbang (761081) | about a year ago | (#45077241)

Your sense of history isn't quite correct. The dealer networks were found to sell more cars, and quickly, and shift inventory burdens easily. There was anti-trust concerns at the time, but this was neither legislated in the US or mandated. It was more or less goaded organic growth. I'm not trying to justify dealer networks or argue against them. Value needs to be established in consumer supply stage, and dealers are going to have to work harder than before, because their value proposition to consumers has been usurped by convenience and non-confrontational values on the part of consumers.

Re:This is a GOOD thing (0)

Anonymous Coward | about a year ago | (#45077289)

...That was done away with to protect the consumer.

Funny.

Re:This is a GOOD thing (1)

profplump (309017) | about a year ago | (#45077871)

GM currently doesn't do same-day delivery, but that's not a limitation of a central sales model -- they could easily stock cars in warehouses around the country ready for immediate delivery if they thought the sale advantage was worth the overhead.

Re:This is a GOOD thing (2)

i.r.id10t (595143) | about a year ago | (#45078099)

They could even convince other businesses to form, buy or lease large swaths of land, and warehouse that inventory for them. Heck, these new business may even pay for the privilege But then... maybe someone really does want the feature set that the marketing folks thought 68% of the car buying public would want (or what the marketing folks wanted them to want....). Maybe these storage/delivery/prep businesses would be willing to try and convince someone to buy a particular car in storage, convince them that yes, this is the car for them! They don't want to go home and get on the internet and order one from that other car maker... we have the perfect car for you right here! Oh, and maybe, like just possibly, the person who wants to buy doesn't quite have enough ready cash.... why maybe, this storage place, the folks that work there happen to know of this local bank that will make a loan against the value of this here car....

I know, this sounds like crazy fantasy right? Well, believe it or not, it is true!

Re:This is a GOOD thing (0)

Anonymous Coward | about a year ago | (#45077117)

No negotiating

You say that as if you think it is a good thing.

It means I'll pay thousands more for the same car, an amount that is well in excess of the overhead added by the dealership.

Sounds great! (0)

Anonymous Coward | about a year ago | (#45076971)

I won't miss dealerships at all. Useless middleman money.

The cost of a car should be exactly the same no matter who you are. It pisses me off that those with relatives who worked at car manufacturers many years ago pay thousands less than me for the same exact product. It makes me not want to buy a new car, period.

Charging a flat, consistent rate is smart business. Fuck dealerships.

Re:Sounds great! (1)

beatljuice (735526) | about a year ago | (#45077113)

You've obviously never owned a successful business.

Re:Sounds great! (0)

Anonymous Coward | about a year ago | (#45077471)

I do. In conducting that business, I try to contribute more value than I capture. It's proven to be successful so far.

Re:Sounds great! (2)

profplump (309017) | about a year ago | (#45077893)

I wouldn't define any business that acts as a legally-protected middleman as "successful" -- actually successful business provide their own value and don't need legal protections because customers are happy to pay them for that value.

Almost Nobody will buy a car online ... here's why (0)

TrollstonButterbeans (2914995) | about a year ago | (#45077029)

Would you buy a house online?

What if you have a trade-in? How can you do that online?

How do you know if you want to buy versus lease a car?

Only 2% of people buy cars online and almost without exception these people are brokers.

There have been plenty of "no haggle" dealerships in the past, present and future --- but generally it doesn't work because few people are willing to spend $20,000 to $50,000 without trying out the merchandise and there are always a variety of incentives. And this ignores the entire issue of trade-in values for someone's current vehicle.

No one buys houses online or rents apartments online because it is a major purchase.

And for most people buying a car is 2nd biggest purchase they will make. Buying a computer or a vacuum cleaner is one thing --- but a major purchase with a 5 year loan or 3 year lease costing 30% of one's annual salary after taxes isn't something anyone will take lightly.

Re:Almost Nobody will buy a car online ... here's (0)

Anonymous Coward | about a year ago | (#45077077)

You have narrow vision. People will do the exact same thing they do with electronics and appliances. You go to the dealership, use their physical resources to decide which model you want, then go and buy it cheap online. So, people WILL buy cars online, they just won't do it your way.

Re:Almost Nobody will buy a car online ... here's (1)

alen (225700) | about a year ago | (#45077105)

most things online you buy with a credit card
with cars most people have to apply for a loan tied to the specific car. i'm sure banks will love to pay for cars without the verification procedures now in place at lots of dealers

Re:Almost Nobody will buy a car online ... here's (1)

BadCoding (3385247) | about a year ago | (#45077627)

They are still buying it from a dealer, it is just now GM is the dealer.

Re:Almost Nobody will buy a car online ... here's (2)

berashith (222128) | about a year ago | (#45077217)

i have done nearly this. We decided which car we wanted, but went to a dealer to test drive it and check for comfort , fit , etc. We told the salesman what our plan was, so he just gave us the keys and told us to check it out. A few weeks later we made the decision, had a deal in hand, and went back to the guy that treated us right and told him the deal we had. Let him know that if he could match what we had, or give us reason for something better, then the sale was his, and that we returned only because he had treated us right on the first day.

Customer service can still win a sale, because as you say, there is a need for the consumers to actually see and touch the car in many cases.

Re:Almost Nobody will buy a car online ... here's (1)

Dare nMc (468959) | about a year ago | (#45077209)

While Tesla has no dealers, they have show rooms. That takes care of half the equation, the whats it look, feel like. Ideally the rental/try before you buy/short term lease is the best next step. I would rather pay $50 to rent a car, for the weekend without pressure than pay thousands to have a person pressuring me to buy (wont be the exact car, but close enough.) Then closing the deal online vs a shake of the hand makes no difference to me. I would love to do that with a house as well (practically what I did do.) Research the houses, load them all in the GPS, go look at them. The last step would be the only change, instead of calling a relator, meating at the hose, filling in paper work, waiting days, then meet up a month later with lots of paperwork without time to comprehend. Been much cheaper, and better all around if I could have just click my offer, get the counter, click a couple times for that last step.

Re:Almost Nobody will buy a car online ... here's (0)

Anonymous Coward | about a year ago | (#45077319)

I know someone who won't buy a Tesla because there are no nearyby dealerships. When it breaks do you take it to a Prius mechanic, or pay the $500 to ship it where it can be fixed.

I think Tesla is making a big mistake with their plans. In the long run it won't matter, unless someone else does the same thing and gets dealerships everywhere quicker. Tesla also may not be able to floor plan the inventory for dealerships, where Tesla owns the car for the first 90 days they sit on a lot unsold, which may be one of the major reasons they are not doing it.

Re:Almost Nobody will buy a car online ... here's (2)

SternisheFan (2529412) | about a year ago | (#45077387)

Re:Almost Nobody will buy a car online ... here's (1)

TrollstonButterbeans (2914995) | about a year ago | (#45077501)

If we could subscribe to cars like how we pay for cable or pay for cell phones, your idea would work.

And it would be optimal --- why should we buy instead of lease --- ideally! Then again, some people would argue we should all rent instead of own homes. What is the answer? Only the future can know that!

But you raise great points!

Re:Almost Nobody will buy a car online ... here's (2)

Dare nMc (468959) | about a year ago | (#45077877)

I have wondered how to make borrowing/sharing more fluid. IE I need access to a truck a couple days a month. I need access to a 5 passenger vehicle 6 times a year or so. I need a daily driver for 20 miles each way trip. I want a camper 3-4 times a year. So I have a quad cab pickup that takes care of all these roles. Much cheaper than trying to maintain insurance, license, tires, etc for multiple vehicles. Difficult to share something like this because people all expect a different level of care, and you can't rent and expect to have it reliably have a working everything I need. IE above average battery for the camper, or above average tires for pulling a boat from a lake in marhc... But ideally with the right level of trust, I would be willing to have a complete inventory and state of everything I own in a databse ready to share with the community in exchange for access to the same. Save the neighbor I never met from driving to the store for a wheelbarrow, save me from having to buy a planer for that one project...

Re:Almost Nobody will buy a car online ... here's (1)

TrollstonButterbeans (2914995) | about a year ago | (#45078037)

Well ... what you can do ... rent a 5 passenger vehicle for $50 a day or rent a camper.

That is what the rental places are for --- I came to your same conclusion a long time ago. We don't need to own everything we ever use.

Re:Almost Nobody will buy a car online ... here's (0)

Anonymous Coward | about a year ago | (#45077293)

I work for a company that is branching into online only car sales, we are about to launch our trade in program. It isn't that hard, and the lease/buy stuff is a lot easier when we can show you the difference and let you customize the deal in a way that works for you.

The test drive is hard to get around, but we have a no questions asked return policy. So we recommend you use that as a test drive.

Re:Almost Nobody will buy a car online ... here's (1)

Brett Buck (811747) | about a year ago | (#45077839)

I bought a car online, and I am not a broker. No big problem.

Re:Almost Nobody will buy a car online ... here's (1)

TrollstonButterbeans (2914995) | about a year ago | (#45078069)

Perhaps you bought a Zune, a Surface RT and really like the new Blackberry phones too!

Or maybe you are a market of one.

By the way, what car did you buy online and what price did you pay --- I mean, why withhold details for a true story if you see what I say?

Call me a Luddite... (0)

Daemonik (171801) | about a year ago | (#45077049)

Hilarious that there's another thread today [slashdot.org] about how increased mechanization is destroying the job market, so let's see.. self driving cars/trucks replacing all the professional drivers, manufacturing robots taking over the factories that haven't already moved to China, car dealerships doomed so there goes the jobs AND the thousands of small businesses and their local taxes.. tell us again how this is all good and the displaced workers will all go into software consulting, robot repair and get engineering degrees and we'll all have well paying middle class lifestyles. Go on, I'm waiting.

Re:Call me a Luddite... (-1)

Anonymous Coward | about a year ago | (#45077553)

Did you take time off of beating your wife to post here today?

houses are next (0)

Anonymous Coward | about a year ago | (#45077053)

Buy your next house on the web! Free delivery to your vacant lot! Need land? We'll sell you some! With free delivery!

This is the world's smallest violin... (2, Funny)

sootman (158191) | about a year ago | (#45077119)

... playing just for the middlemen.

Re:This is the world's smallest violin... (1)

TrollstonButterbeans (2914995) | about a year ago | (#45077487)

Sounds like one of those posts rooting that Microsoft will die.

Amazon.com and EBay have tried to do this for 15+ years. But very few people are going to make a $20-$50 thousand dollar purchase online.

Wanting something to be true and successful won't make it so.

Most people looking for a car end up going to several different dealerships to do research to determine what they want to buy. How can they do that online?

What you want would be perfect and I agree, but the crappy truth is like Soylent Green: OMG! The world is made out of people! It's people!

Think of the guy at McDonalds who spends 5 minutes looking at the menu before making a decision. Sad but true, life is like that. Sometimes even for people like you or me.

Emotionally, your thoughts win. But in reality, 3 years from now --- people are still going to dealerships trying to make up their mind on what to buy and why because cars are a big-ticket item costing tens of thousands of dollars --- it is huge decision.

Not Much Different From Existing Web Buy (2)

Kagato (116051) | about a year ago | (#45077131)

This isn't all that different from existing car buying websites (outside the GM lock-in). Most sites like Edmunds, Autotrader, Cars, etc have features like inventory search, pricing, options, suggested market pricing. These sites connect you with dealers. The dealers pay the web sites to the leads. In return the sites get sales pricing data (which is one of the ways sites like Edmunds figures out TMV). I'm sure GM has a charge for the dealers for the leads. Perhaps slightly less than independent sites.

All GM is doing is pre-qualifying the financing, which mean the leads are slightly higher quality than Joe Blow internet.

If you wanted to get a better deal but don't like the art of the sale, Costco Auto is the better route to go.

I was just thinking about this since... (4, Interesting)

Strudelkugel (594414) | about a year ago | (#45077143)

I bought a new car recently. I try to keep my cars as long as possible, but the old one was causing me to wonder how long it would last without another expensive repair. That meant a trip to the dealership, knowing quite well that I was about to have the worst category of retail experience known. It doesn't matter if you are buying a cheap car or an expensive one - dealers treat all customers the same way. Haggle, make you wait while the sales person "I will try to get my manager to accept your price, but he is going to beat me up..." talks fantasy football with his manager as you wait. (If you are trading in a car, they will take your keys to look at your trade-in. You will not be getting them back any time soon, so be sure to bring an extra set of keys you can drive off the lot while they are playing this game to wear you down.) Make them wait while you enjoy a sandwich or read a book in the coffee shop across the street.

After you endure that nonsense, you get to talk tot he "finance manager" who will try to get you to by an insanely overpriced extended warranty contract. If that doesn't work for the dealership, they will be happy to offer you very high rate auto loan. Think of what is happening: The sales rep is telling you how great the car is while you are looking at it, then the finance person is telling you an extended warranty is really needed because the car will probably have a major repair after the warranty period is over. Be sure to ask the finance person if they think you should tell the sales person you will not be buying the car since he or she just told you it really isn't a very well made car.

Car dealerships are really parasitic IMHO. They use their intermediary status to extract as much as possible from customers, and in doing so alienate the customers from the manufacturers. The manufacturer spends a huge amount of money establishing a brand, designing cars they hope will appeal to the public, taking capital risk, and managing production. Think of the extended warranty pitch - it totally undermines the manufacturer since it implies the car really isn't very reliable. My previous car was a high end brand, but I detested the sales and service department at the local dealer so much I vowed to never buy another model of that brand, even though I really liked the car. But none of this is new to anyone who has purchased a car from a dealership, new or used.

Given the above, and manufacturers know all of it, I am surprised that Ford and Chrysler aren't jumping on the direct sales model, too. They probably will though; the dealership model makes far less sense now that consumers can learn more about a car online than most car sales people will ever know, since that is not what they care about. Before the internet, it was necessary to go to a dealership to look at a car, maybe get a brochure and see what the car actually looked like. Of course the buyer still has to test drive the car, but there is no reason manufacturers can't follow the Tesla model. This is a bit of a simplification, since Tesla cars in high demand and people are willing to wait for one. There is also a lot to be said for having inventory on a lot since it simplifies distribution and might help close a deal. But... I think every manufacturer would clamp down on the pathetic treatment of customers their dealers engage in if they were selling directly.

A friend of mine is thinking about buying a BMW M3, but I told him he should drive a Tesla first given that the two models are similar in price. The BMW might be a good car, but he dislikes the dealership experience as much as anyone. Why support the dealership business model if there is a choice? My thought is that my next car will be a Tesla not only because it is a great car, but also because I know my money won't support the jerks who run auto dealerships.

Given the intermediary advantage the dealer has when approached by a customer, it is no wonder they are fighting the direct sales model. They have a license to steal, and don't want to give it up. We have seen this before in music business. The good news is information technology will most likely level the playing field in the future, sending the business practices of car dealers to the case study guides of yesteryear, along with patent medicine, unregulated meatpacking and oil trusts.

In all fairness, I would like to encourage anyone who works, or did work for a dealership to offer objective reasons for their business model in case there is something I have missed. But given my experience, it certainly is hard to rationalize.

Re:I was just thinking about this since... (2)

Lloyd_Bryant (73136) | about a year ago | (#45077587)

(If you are trading in a car, they will take your keys to look at your trade-in. You will not be getting them back any time soon, so be sure to bring an extra set of keys you can drive off the lot while they are playing this game to wear you down.)

I had this happen once. Fortunately for me, it was a fairly busy day, with a dozen other customers in the showroom. I went to the manager's office, and told him to either return my keys, or I'd go out in the showroom and very loudly complain about this particular tactic.

I got my keys back (and was escorted out of the showroom) in under 2 minutes...

Re:I was just thinking about this since... (4, Informative)

jhealy1024 (234388) | about a year ago | (#45077633)

Bought a car a few years ago, and found this non-profit that had a great strategy:

    http://www.checkbook.org/auto/CarBargains_Secrets.pdf

You can never know what the dealership is getting from the factory in terms of kickback, so it's next to impossible to negotiate a deal all by yourself. The sales rep is never going to lose money on the car (despite what they may tell you); they'll just walk away. So even when they cry and tell you you're keeping them from feeding their family just know that they're making enough to cover their expenses. Your best bet is to put your purchase out to bid to multiple dealerships and let them fight it out. We did this and saved $2500 off the "invoice" price that Consumer Reports said we should be "aiming for" to get a good deal.

Let me say it again: make them bid; it's the only way to keep them honest.

As a side bonus, you don't have to deal with crazy add-ons, haggling, or waiting for managers to "approve" your deal. You e-mail the dealerships, tell them what you want, and ask for their final, out-the-door, all-fees-included price. Pick the winning one, print out the e-mail so you have it in writing, and go to the dealership to pick up your car. If they try to add anything on, just point to your e-mail and invite them to throw it in for the included price you've already committed to (we got "free" floor mats and locking wheel nuts, probably because they didn't want to bother to take them off).

Note that you have to be willing to contact multiple dealers, wait for responses, and follow through. If you want to buy the brand-new 2014 model whatever, in hot pink, and you need it TODAY, then this isn't the strategy for you. If you're willing to be patient to save a couple grand, try it out.

Re:I was just thinking about this since... (2, Interesting)

Anonymous Coward | about a year ago | (#45077993)

To put more bite in your tactic, you really need to make sure that the dealerships are not owned by the same person or group. A friend of mine tried that and the bids came in pretty similar and didn't move much. He was driving by a nearby county seat (about 30 minutes away) just to see what they would do, they came back $500 cheaper than the email. He told them he would think about it. All of a sudden, he had a real bidding war in the emails. He ended up getting it for $2000 less than what he was originally going to buy it for. Only later did he find out that all dealerships in our town are owned by the same individual through a complicated corporate scheme thanks to an investigation by the local news.

Re:I was just thinking about this since... (1)

FlyHelicopters (1540845) | about a year ago | (#45078103)

While those points are all fair, there are indeed dealers who do it differently. I purchased my GMC Yukon XL from a dealership on the edge of town that is hungry for the business. First price offered? Dealer invoice with nothing added. Extended warranty? Half of list price (turned it down, they didn't push). 0% financing of course. Trade value? $2K over good condition KBB.

Frankly, I didn't even have to argue with them, I knew my numbers, did my Edmunds research, asked for $200 more off the price just to feel like I won something, they said sure, and off we went. Whole thing took 2 hours start to finish, including F&I paperwork.

I have no complaints. Yes, I understand that is probably the exception.

GM Has been for the most part innovative but... (0)

Anonymous Coward | about a year ago | (#45077153)

GM has tried time after time to be innovative like the experimental car shell thing where you could go to a GM dealership and get a new car design whenever you like. It didn't workout but it was interesting. They did innovate a lot with safety systems and such but they are very corporate and too scared to try something new when dealerships already work. But people are used to buying stuff online, and nobody likes talking to a car dealer. Innovation means risk and risk means the possibility to lose a lot of money. Just wake me up once I can order cars on Amazon using my prime account for free 2-day shipping. kthnxbye!

the future is bright for Al Bundy (1)

Anonymous Coward | about a year ago | (#45077161)

At least women can't buy shoes online. No Ma'am!

I bought my Mercury via ford.com (0)

Anonymous Coward | about a year ago | (#45077221)

Ford lets you browse the dealer's specific inventory and make you r deal without setting foot on the lot. When I bought the car it was parked out front waiting for me. I took a quick test drive, handed them the check I had ready and drove it home. That was 8 years ago. Now they'd have just delivered the car to my house, that would have been even better!

Earth to GM—time for reality check (1)

mendax (114116) | about a year ago | (#45077257)

I will not—repeat—NOT buy a car unless I have driven it first. So, I will test drive it, then go online and see if I can get it from GM for less. If I and others can, GM will put its dealer network out of business. How are they going to sell cars then? They'll have to open a series of GM stores as the dealers get put out of business, something which will probably get the remaining dealers into Federal court fast. And if GM ultimately wins and you can only buy a GM car from GM, I'm not certain I want to buy a GM car from them. I can guarantee you that it will not be the same as visiting the local Apple Store.

Re:Earth to GM—time for reality check (1)

Phoeniyx (2751919) | about a year ago | (#45077343)

You were making reasonable points, until the last two sentences. Lol wut? "And if GM ultimately wins and you can only buy a GM car from GM, I'm not certain I want to buy a GM car from them.". Elaborate please. What's wrong with buying a GM car if "you can only buy a GM car from GM".. Doesn't compute as to why this is a bad thing...

Re:Earth to GM—time for reality check (1)

_merlin (160982) | about a year ago | (#45077615)

I can guarantee you that it will not be the same as visiting the local Apple Store.

You say that like Apple Stores are pleasant. In my experience, they're great if you want to fawn over the products on display, but terrible if you want to actually buy anything or get support. The "geniuses" are unknowledgeable, arrogant twats with condescending attitudes. Staff are always too busy to help you, or assure you that someone will come to look after you then no-one does. Unless you need something on the day, you're better off buying online.

Re:Earth to GM—time for reality check (1)

gl4ss (559668) | about a year ago | (#45077903)

..look man, where the effing fuck do you think the dealer buys their GM cars from? think mcfly think!

aanyhow, how about they bring the car for a test drive over to your house?

what you would be losing with the dealers(as dealers) out of the picture is HAGGLING. I fucking hate haggling. and the price you're haggling about is the dealers cut, GM has a set price for the car..

Everything else comes from the Internet (1)

Reliable Windmill (2932227) | about a year ago | (#45077269)

We're so used at looking at reviews and videos of stuff and ordering on the Internet. We even order clothes on the Internet without having a way of trying them on, so why not cars? Even grocery shopping can be done over the Internet these days.

Re:Everything else comes from the Internet (1)

LandDolphin (1202876) | about a year ago | (#45077325)

IN most states you have X number of days to return a car before the sale is "final". Buy it, if you don't like, return it.

Yeah but (1)

jeffgtr (929361) | about a year ago | (#45077383)

I buy a lot of things online. With something as long term and expensive as a car I want to drive it first. In addition I want someplace to have it maintained and repaired. Shop, click, drive - No way. Last time I bought a car and researched online. There were cars I thought I wanted but once I drove them I didn't like them. If my car has a problem I take it to the dealer, they fix it and I can trust them. I drive a Toyota btw not a GM. The experience at the dealership is actually pretty good.

My ups. (0)

Ralph Ostrander (2846785) | about a year ago | (#45077385)

The 192.168.1.3 on the fast fiber.

Good idea (1)

ErichTheRed (39327) | about a year ago | (#45077407)

Good idea, but isn't Best Buy and other retailers complaining about the "showroom effect?" How's that going to work when car dealers are just giant test drive outlets?

That said, wow, the ability to drop the stupid haggle dance with your typical slimeball car salesman would be awesome. I'd pay more for the privilege. I can't stand haggling over a few hundred dollars, and actively dislike all salesdroids.

One factor they have to take into account is that car dealerships actually don't make much money on the cars themselves (unless you pay MSRP.) They make money on the sleazy stuff like:
- Financing. People who come in and say "I can pay $X/month." OK, here's an 11-year loan at 14% interest...
- People with bad credit
- Useless options/warranties/accessories they try to push on you at the last second
- Leases -- leasing is an awful deal unless you can completely write off the lease payments as a business expense.

So this new system would just have to funnel your order to a random pick of the Glengarry Glen Ross guys at Joey Barbarino Chevrolet, and they would get a flat fee for processing your paperwork. Not as lucrative as all the other stuff they can push on you...

Recently bought a Nissan... (1)

skogs (628589) | about a year ago | (#45077423)

I would have given anything to accomplish this feat with Nissan last year. I figured out what car my wife and I could settle on (2 year process), and then tried to get one. Alas the last of the 2011's were already sold. So then I waited a few months and tried to get a 2012 vehicle. Alas those were delayed due to the flooding that also hit the nuclear plant and made much news. When I finally got a dealer to ship me one from 1200 miles away, I still didn't get all the exact options that I wanted. Most noticeable is that my wife complains about the lighter interior upholstery.

Why should I have to spend months trying to order something that should be so simple as: Middle of the road trim level, brown, with dark upholstery. Honestly I don't understand why I couldn't get those three things together in one vehicle after searching 15 some states.

I had driven several of the vehicles and knew we liked it...just couldn't get it without fancy doodads that we didn't want. I bet straight internet orders wouldn't get jacked up by the dealerships quite as bad.

Not new (1)

mypalmike (454265) | about a year ago | (#45077475)

Welcome to Mini Cooper a la 2006.

Couldn't happen soon enough (1)

laffer1 (701823) | about a year ago | (#45077483)

Recently purchased a new Mustang. I wasn't sure this time what I wanted and had a list of possible choices including the Camero, FR-S and Challenger. Many of the local dealers don't want to order a vehicle. Few had base models on the lot. Anything under 30k wasn't on the lot. Some dealers didn't even have a car I could test drive.

Step 1 is actually forcing dealers to keep updated inventory. I don't know how many times I went to a dealership or called and a vehicle had been gone for weeks.

If GM improves this process and it works for them, perhaps we'll see better service from all the automakers. I'm all in favor of that both as a consumer and computer programmer in Detroit.

How to do this right in two steps (1)

onyxruby (118189) | about a year ago | (#45077523)

Step 1.
Make a simple web site where I build the car that I want to buy and tell me what the MSRP should be. If I want the purchase agreement can be signed digitally on the Internet and I all I have to do is go pick it up.

Step 2.
Allow me to have dealers in a range I am willing to travel bid on selling me the car I spec out in step 1. Any participating dealer can submit a bid for what they will sell the car for. Once the bid is accepted I sign digitally on the Internet and all I have to do is go pick it up.

The entire point is to allow people to purchase a car and sign the contract without ever interact with a dealer. Importantly by signing the contract over the Internet with GM you don't have to worry about the dealership pulling something once you show up or backing out.

The dealership experience is so bad that most people would rather get a root canal than deal with a salesperson. Allow people to buy a car without worrying about getting ripped off because they are female, black, immigrants or whatever else.

Do you have to pay MSRP? (1)

linuxguy (98493) | about a year ago | (#45077573)

I don't like buying from a dealer, but I don't like paying MSRP either. If dealing with the dealer means I save a few thousand dollars and not pay MSRP then I'll gladly sit through the upsell process and constantly say NO for an hour or so to various options they try to sell me. I have done that a few times by now and I think I have mastered it.

Re:Do you have to pay MSRP? (0)

Anonymous Coward | about a year ago | (#45077981)

I'd rather the MSRP be something non-negotiable. I'd rather know what I can actually buy a car for when cross-shopping.

I just bought a $30,000 Mazda for just under $26,000. A few dealers 1800 miles away have the exact same car, new, for around $22,000 as they have a few 2014 models on their lots now.

Mini probably has the best website for customizing a car. It's not perfect, however it is close. I should be able to pick *any* paint and interior color scheme & chip that I want as long as I'm willing to sign for the car before it's painted. I don't expect a custom car that I can back out of.

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