Auto Sales Drive E-Commerce News

On a relatively quiet day in mid-August — a period when it seems half the country is on vacation and the other half is still unpacking the car — the subject of auto sales was the driving force in e-commerce news circles:

Online car-shopping site Autoweb.com announced Wednesday that it would add direct sales of new cars to its dealer referral service,Industry analysts were reportedly told by eBay (Nasdaq: EBAY) that it may begin selling automobiles on its Web site in the next few months, and General Motors (NYSE: GM) and DaimlerChrysler are both intensifying their e-commerce efforts. The flurry of online auto sales news comes at a time when analysts and observers say that the industry is poised to take off. Forrester Research of Cambridge, Massachusetts predicts new online car sales will leap from 15,000 this year to 500,000 in 2003.

Autoweb is just the latest in a lineup of online auto sales sites to offer new car sales, as opposed to just referrals to one of its 5,000 dealer members.

CarsDirect.com, owned by Dell Computer founder, Michael Dell, launched a site in May that allows consumers to buy a car wholly through the Internet. AutoNation followed suit in June.

eBay — which is still reeling from its latest power outage — is looking at the auto industry as a significant chunk of business in the coming years, analysts say. The company bought Kruse International, an auctioneer of collectible cars, in May, and reportedly intends to introduce a Great Collections auction by the end of the year.

Not Just Online Sites

Auto industry makers and dealers large and small, electronic and bricks-and-mortar, are getting in on the online act. General Motors unveiled a new Internet unit called e-GM on Tuesday. The site will host electronic shopping malls that will allow real-time sales and car-buying information. The world’s largest automaker, GM’s online push is expected to have a major impact on the industry.

DaimlerChrysler — a $38 billion (US$) merger last year between the German and American automakers — announced Tuesday that it hired San Francisco-based Internet service company, Organic, to build Web sites that will connect the automaker with customers and dealers.

The company has earmarked $500 million in a campaign to create a network to link up with its Dodge, Chrysler, Plymouth and Jeep dealers worldwide. Any Internet move by DaimlerChrysler is an improvement on its current site, which is primarily limited to offering price quotes on its wide range of models.