When it launched its service, CarsDirect.com set retail prices at the invoice price plus 1 percent. That way, the Web company figured, it could compete with most dealers in its markets. But savvy shoppers immediately figured out what a juicy deal that could be for vehicles in high demand.
Case in point: In the Los Angeles area earlier this year, the Porsche Boxster was selling on dealer lots for $43,000 and more. CarsDirect.com buys from dealers. But CarsDirect.com was offering the popular sports car online for about $37,000.
'We sold a bunch of those,' CarsDirect.com Vice Chairman Scott Painter said ruefully.