GM halts venture with Autobytel

General Motors has pulled the plug on a six-month-long joint online shopping venture with Autobytel Inc. of Irvine, Calif.

The move ends speculation that GM could expand its relationship with Autobytel and possibly buy an equity stake in the company.

A registration statement GM filed with the Securities and Exchange Commission in February said the company was interested in buying a stake in a third-party online buying service or in an online joint venture with dealers.

GM has nixed both options because of the negative economic climate for Internet ventures, said e-GM spokeswoman Ryndee Carney.

GM will integrate eGM unit

Meanwhile, GM plans to roll its e-GM business unit - which had overseen the pilot progam - into the corporate structure. But what role

e-GM President Mark Hogan will be assigned to is unclear.

"Over the next year, we'll start to integrate it," said GM spokesman Pat Morrissey. "But there's no timetable for it - just a natural integration of e-business into the traditional operations.

"As far as Mark's concerned, he's still going to be running e-GM for as long as he knows," Morrissey said. Hogan was not available Friday, Nov. 16, for comment.

Forty e-GM employees have been transferred to GM's vehicle sales, service and marketing division, where they work on e-business activities, Morrissey said. They still report to Hogan. There now are 100 e-GM employees.

Created in 1999, e-GM was envisioned as a way for the automaker to consolidate its global e-commerce activities while wresting control of lucrative Internet sales from the dot-coms.

At the time, estimates were that as many as 500,000 new vehicles would be sold over the Internet in 2003.

GM's Washington-area pilot program, which began May 1, led to about 200 sales.

Program reached customers

The pilot program had 22 Chevrolet dealerships testing a locate-to-order model, for which consumers could shop local dealers' inventory online. Consumers found the inventory through Autobytel.com, and dealers paid Autobytel for referrals.

"We know we were reaching different consumers getting leads from Autobytel," said Carney, explaining that just 4 percent of the people who shopped Autobytel.com also shopped the GM BuyPower site.

Autobytel Chairman Mark Lorimer said the pilot program was expanded twice and ran twice as long as it was intended.

"We did what we said we were going to do at the beginning of the test," he said.

According to SEC documents, Autobytel earned $3.8 million in consulting fees for the pilot program through the first nine months of the year. That represents about 7.5 percent of $50.6 million in revenues.

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