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Growing online car sales push out the salesman

February 2, 2017

The car industry is slowing but surely undergoing a transformation and industry experts predict that 2017 will see this transformation intensify. Motorists are shunning traditional dealerships, garages and their salesmen, in favour of purchasing vehicles online.

With online spending in all industries on the up, it’s no surprise that the car industry is also being affected. The convenience of shopping online cannot be ignored. There is definitely a huge comfort factor in being able to select the exact specification of the car that you desire and even part-exchanging your old vehicle, all from your own home. It’s undoubtedly a lot quicker and these days, anything that saves time is attractive.

Another factor has to be the removal of the awkward and much-dreaded negotiation with the salesman; the old joke about the “used car salesman” unfortunately has a large degree of truth and it is starting to appear that many people would prefer to skip the middle man.

For those who want to see the car ‘in the flesh’ before they buy and even test drive the vehicle, online car selling sites are even including this service. This does often mean a trip to a local dealership, but then the process can be continued online with minimum human interaction involved!

The online car selling market is an interesting one and with the success of several car-broking sites, car makers have realised that they may be missing a trick and are launching their own sales websites; Peugeot, Hyundai and Smart are all recent additions. Hyundai’s Rockar brand is a fascinating example, they created the online only company with a view to empowering the customer and being a genuine game changer.

Realising the need for people to see the vehicles, but wanting to avoid dealerships, they set up in major shopping centres, where “Rockar Angels” will show you the vehicles, but not sell them to you; that part you do online. You can book a test drive on their website, but they say that only 53% of their customers actually do this, with many people being happy to purchase without having first driven the vehicle.

Generally speaking, buying online ensures lower prices than offline but it’s not quite that clear cut with car sales. The prices online are often fixed, there may well be set deals or extras included, but the manufacturers are generally too reliant on their dealer networks and so are reluctant to totally cut them out of the sale, which of course gives less price flexibility, keeping prices higher online.

There are always going to be people who like to buy face-to-face, particularly with large purchases, and even those who enjoy the negotiation process, so this is never going to involve 100% of consumers, but with an increasingly demanding population that insists on being able to purchase everything online and instantly, the car industry will undoubtedly see a shift online over the coming years.

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