A British dealer group is reacting to the threat of supermarket chains entering car retailing - by selling cars through a supermarket chain.
Lookers created a new sales subsidiary, look4cardeals.com, which offers cars via Internet links at kiosks inside Morrison supermarket stores. The cars are available at a discount from the national inventory of Lookers' 84 multi-franchise dealerships in the UK.
The first look4cardeals.com kiosk located inside a Morrisons store in Oldham, near Manchester, sold its first car within hours of opening. Lookers is opening two more kiosks in Morrisons stores in Bradford and Sheffield as pilot operations.
If they are successful, Lookers and Morrisons plan to open more kiosks throughout the UK.
'There has been considerable speculation that supermarkets might come into car retailing,' said Lookers Chairman Fred Maguire. 'But by using Internet technology, we are allowing shoppers to research their car purchases in the supermarket.'
Maguire said the arrangement solves the problem of aftersales service for supermarkets. Customers have support from a franchised dealer even though they ordered their cars through a supermarket.
'That means no problem with part exchanges, no problem with delivery, no problem with aftersales and servicing, and no problem with specialist finance,' said Maguire. 'We can even offer test drives at home or at work.'
The Internet deals through Morrisons offer discounts of up to £3,500 (E5,605) on some cars. A Lookers spokesman said similar deals were available on the dealer website or at dealerships.
With 113 stores, Morrisons is the UK's No. 5 supermarket chain with annual revenue of E5.6 billion.
Lookers is a major UK dealer group with annual revenue of E1.1 billion.