UK pilot for Amazon’s online car dealership?
Less than a year after launching its online car business in the US, technology giant Amazon could be planning a European pilot based in the UK.
According to German automobile trade periodical Automobilwoche, Amazon will have Luxembourg as its European base, but is already recruiting staff in the UK ready to launch a pilot sales drive here. This follows a trend for Amazon to test its ideas in the UK before rolling them out across to the continent. Online car dealership – based on its US model – would include the opportunity to access extensive research and customer reviews on cars.
This project would dovetail with Amazon’s move into providing finance deals. It already offers loans to marketplace traders. Industry pundits believe that the next logical step will be to offer car loans to consumers, including favourable rates for Amazon Prime members.
The potential for Amazon to take on car retailing follows its recent pattern of diversifying from core product areas and business values too. The online retailer recently bought the Whole Foods store chain, meaning it now operates at least 400 physical shops.
Amazon “tested the waters” in the motor trade, by forming a partnership with Fiat in Italy. The online retailer showcased the 500, 500L and Panda models and connected customers to established dealerships, in return for a fee. This particular toe into the motor trade is an ongoing arrangement until the end of 2017.
Though it could be that a similar arrangement is planned for the UK car marketplace, launching a fully fledged online car dealership is considered to be more likely.
Research earlier this year (by the NFDA’s Trusted Dealer) discovered that increasing numbers of British people are willing to consider buying a car online. However, a substantial proportion of those would want this deal backed by an established franchise.
Both this research and Amazon’s potential assault on car sales in the UK means existing dealerships need to develop robust marketing plans and build their digital sales and information services.
Certainly a period of change is on the way if Amazon does take on the automotive market by selling vehicles in Britain. Some of the smaller dealerships could well find it hard to survive in the face of this online competition from the global technology leader.
If you have an online car dealership, make sure that your combined motor trade insurance is up to date.