- You can now buy new vehicles and trade-in old ones via Amazon Autos
- It’s initially available in 48 cities across the US
- More automotive brands are set to join the platform next year
The world’s leading online shopping marketplace announced that it was teaming up with Hyundai to start selling its vehicles at the tail end of last year, with Amazon users able to browse models and register interest, but not physically purchase them.
Now, Amazon has announced that Amazon Autos (Beta) is now open for business in 48 US cities. The service allows buyers to browse vehicles at leisure, pay with a customized finance option (or pay cash, if you’re a baller), or select optional protection products. You can either head to a local dealership for collection or arrange to have the shiny new car delivered.
The general idea is to beat Tesla at its own Direct-to-Consumer (DTC) game by offering a convenient sales channel that circumvents the need to sit in a stuffy dealership and haggle with a salesperson over the sometimes inflated price.
According to numerous Cox Automotive studies, which ask customers about their car-buying experience, overall satisfaction with the traditional dealer model is on the wane in the USA. However, Fan Jin, global head of Amazon Autos, says the new online platform is making shopping for a new car more transparent, convenient, and customer-friendly.
Arguably merging a number of online car-buying tools into a single online destination, Amazon Autos allows customers to get an “instant valuation” on their existing used vehicle, with the ability to trade it in toward the price of the new car.
Although the final valuation of said used vehicle will be decided by an independent third-party.
Currently, Amazon Autos only lists select Hyundai vehicles, chiefly the Ioniq 5, although the brand says it plans to roll out new models and feature additional automotive brands next year, while potentially expanding its business model to territories outside the US.
Analysis: Just another shop window
Steven Suh, general sales manager of South Bay Hyundai, said in a statement that Amazon Autos “allows us to showcase our vehicles to millions of daily shoppers,” revealing that customers “come in excited to pick up their new car”.
So however novel it may seem, Amazon Autos is just another online shop window that will eventually see a customer set foot in a local dealership, either to collect their vehicle or when they eventually have to return for servicing, repairs and routine maintenance.
Sure, it avoids the awkward haggling with a salesperson in the first instance, but it still doesn’t completely eschew a ‘legacy’ dealership model.
Secondly, Amazon doesn’t make it clear how a test drive arrangement would work, with interested parties likely contacting a local dealer through the online marketplace to arrange some time with the vehicle. Free returns and Prime delivery don’t really work with something as large and expensive as a car.
Alas, Tesla has been successful with its mobile technician offering and the automation of its servicing schedules and routine maintenance. Remote diagnostics allow its mechanics to work out issues from anywhere in the world and if a vehicle absolutely has to visit a shop, Tesla will recommend and book in via one its trusted local repairers.
Because electric vehicles require less frequent servicing due to a reduction in mechanical parts, an increasing number of manufacturers are looking for more convenient ways for customers to interact with their products.
Tesla has proven that you don’t necessarily need a network of dealers to be successful, while Hyundai is clearly testing the waters to see if it too can future-proof its brand with an increasingly digital offering.