Online car buying fast approaching
Skip to main content
Sister Publication Links
  • Automotive News Canada
  • Automotive News Europe
  • Automotive News China
  • Automobilwoche
AN-LOGO-BLUE
Subscribe
  • Subscribe
  • Account
  • login
  • HOME
  • NEWS
    • Dealers
    • Automakers & Suppliers
    • News by Brand
    • Cars & Concepts
    • Coronavirus Coverage
    • China
    • Shift
    • Mobility Report
    • Special Reports
    • Digital Edition Archive
    • This Week's Issue
    • VW badges rtrs web.jpg
      VW Group operating profit drops by half in 2020
      Washington Auto Show postponed amid ongoing COVID-19 pandemic
      Subaru expands Feeding America donation, advertising
      Mass. dealership group to pay $1 million in unemployment scheme settlement
    • Nissan flips the switch on electric reboot
      Faraday Future moves forward with EV project, will enlist Geely's help, report says
      Audi to build EVs at new company majority owned by VW Group
      European Chamber rules out American, European export curbs as cause of chip shortage
    • Detroit Aerial Panorama during sunset
      Developing future workers to fuel growth in mobility
      Getting around in Las Vegas often involves long waits for a crowded monorail ride, below, or taking escalators up and down to cross elevated pedestrian walkways along the Strip.
      Las Vegas offers best and worst in transportation challenges
      Where is transportation headed?
      In pandemic environment, RV industry ‘roaring back'
    • Ford's Spin, Tortoise partner to launch e-scooters with remote operation capabilities
      Baidu gets Calif. nod to test driverless cars
      Lime scooters await riders
      Lime plans to add moped-sharing to scooter, bike services
      TuSimple's self-driving commerical truck
      Aeva to supply lidar sensors for TuSimple's self-driving trucks
    • Elon Musk interview
      Tesla’s Model Y, on sale since March, is a showcase of EV technologies competitors will benchmark.
      Technologies of Electrification
      Cadillac’s Lyriq EV will be unveiled Aug. 6.
      Future Product Pipeline
      A CALL TO ACTION
    • 8 rites of winter (and spring) lost to the pandemic
      GM, Ford finally get some love on Wall St.
      Stellantis is born into a new world
      Dealers call on Nissan to revive Xterra
    • Access F&I
    • Fixed Ops Journal
    • Marketing
    • Used Cars
    • Retail Technology
    • Sales
    • Best Practices
    • Dealership Buy/Sell
    • NADA
    • NADA Show
    • Automakers
    • Manufacturing
    • Suppliers
    • Regulations & Safety
    • Executives
    • Talk From The Top
    • Leading Women Network
    • Guide to Economic Development
    • PACE Awards
    • Management Briefing Seminars
    • World Congress
    • Aston Martin
    • BMW
      • Mini
      • Rolls-Royce
    • Daimler
      • Mercedes Benz
      • Smart
    • Fiat Chrysler
      • Alfa Romeo
      • Chrysler
      • Dodge
      • Ferrari
      • Fiat
      • Jeep
      • Maserati
      • Ram
    • Ford
      • Lincoln
    • General Motors
      • Buick
      • Cadillac
      • Chevrolet
      • GMC
      • Holden
    • Honda
      • Acura
    • Hyundai
      • Genesis
      • Kia
    • Mazda
    • McLaren
    • Mitsubishi
    • Nissan
      • Infiniti
    • PSA
      • Citroen
      • Opel
      • Peugeot
    • Renault
    • Subaru
    • Suzuki
    • Tata
      • Jaguar
      • Land Rover
    • Tesla
    • Toyota
      • Lexus
    • Volkswagen
      • Audi
      • Bentley
      • Bugatti
      • Lamborghini
      • Porsche
      • Seat
      • Skoda
    • Volvo
    • (Discontinued Brands)
    • Virtual reveals (Sponsored)
      • GENESIS: 2021 GV80
      • KIA: 2021 K5
      • LEXUS: 2021 IS
      • NISSAN: 2021 Rogue
      • TOYOTA: 2021 Venza and 2021 Sienna
    • Auto Shows
      • Detroit Auto Show
      • New York Auto Show
      • Los Angeles Auto Show
      • Chicago Auto Show
      • Geneva Auto Show
      • Paris Auto Show
      • Frankfurt Auto Show
      • Toronto Auto Show
      • Tokyo Auto Show
      • Shanghai Auto Show
      • Beijing Auto Show
    • Future Product Pipeline
    • Photo Galleries
    • Car Cutaways
    • Design
  • OPINION
    • Blogs
    • Cartoons
    • Keith Crain
    • Automotive Views with Jason Stein
    • Columnists
    • China Commentary
    • Editorials
    • Letters to the Editor
    • Send us a Letter
    • Forget the Ford GT; Moray Callum's biggest hit is the aluminum F-150
      Nikon turns lens on auto factory, build quality
      Bosch_information_domain_computer web.jpg
      Bosch, Continental battle to supply the brain of the connected car
      A victory lap for Detroit car design
    • view gallery
      1 photos
      As Many As The Stars
      view gallery
      1 photos
      A New GM
      view gallery
      1 photos
      The Bridge
      view gallery
      12 photos
      Leo Michael's best of 2020
    • Shifting gears away from the stick shift
      SEMA still a wonderful circus
      Penske still has plenty of races to win
      Ford's turn in the hot seat
    • January 26, 2021 | Will EVs finally find their footing?
      January 19, 2021 | Small car part causes big problem
      January 12, 2021 | Automotive industry shined in 2020
      December 8, 2020 | In a year that lacked luster, All-Stars showed how to shine
    • Jamie Butters
      Tavares knows that he's a star
      Darren Militscher
      Time for new pre-owned pricing tack
      Leo Michael
      Out with the tie, in with the teeth
      4 myths that threaten dealers
    • How Tesla, GM transformed EV market in 2020
      Is sales recovery nearing an end?
      Beijing's uphill battle to boost EV sales
      Nasdaq-like Star Board poised to become key finance platform
    • Used-car biz not getting easier, but it's better
      EV charging
      Time for U.S. to embrace the EV
      Ford's ‘Finish Strong' ad sets right tone for '21
      UAW settlement brings justice, voting rights
    • Is banning ICEs in our best interests?
      GM should share EV risk with dealers
      Ready to buy Mirai, but where to fuel?
      From Toyota store to hydrogen highway
  • DATA CENTER
  • VIDEO
    • AutoNews Now
    • First Shift
    • Special Video Reports
    • Weekend Drive
    • AutoNews Now: Feds rap FCA leaders as company agrees to plead guilty in UAW probe
      AutoNews Now: GM to use Qualcomm's cockpit, driver-assistance chips
      AutoNews Now: Volkswagen talking with suppliers about microchip compensation
      AutoNews Now: Tavares to have 38 direct reports at Stellantis
    • First Shift: Kia dropping two sedans from U.S. lineup
      First Shift: Biden vows to swap federal government's fleet with EVs
      First Shift: Nissan dealers want Xterra's return
      First Shift: Ford prices Takata recall at $610M
    • N.J. dealer helps position peers for ‘electric revolution’
      DCH Millburn Audi
      'Finding the diamond in the rough': How 2020's No. 1 dealership retains talent
      Don Johnson Motors
      'Distinctive culture' cuts turnover, carves career paths at Wis. dealership group
      Why 2020 could be a record year for buy-sells
    • Why the pickup is the auto industry's 'battleground'
      Carlos Ghosn's quest to restore his reputation
      Why Ford must execute to avoid 'deep trouble'
      Why Honda is 'locked and loaded' for 2020
  • EVENTS & AWARDS
    • Events
    • Awards
    • Congress Conversations
    • Retail Forum: NADA
    • Canada Congress
    • Europe Congress Conversations
    • Leading Women Conference
    • Fixed Ops Journal Forum
    • ANE Shift
    • Shift: Mobility at a Crossroads
    • Shift: The Future of Mobility (CES)
    • 100 Leading Women
    • 40 Under 40 Retail
    • All-Stars
    • Best Dealerships To Work For
    • PACE Program
    • Rising Stars
    • Europe Rising Stars
  • JOBS
  • AN Solutions
  • +MORE
    • Leading Women Network
    • Podcasts
    • Webinars
    • In the Driver's Seat
    • Publishing Partners
    • Classifieds
    • Companies on the Move
    • People on the Move
    • Newsletters
    • Contact Us
    • Media Kit
    • RSS Feeds
    • Shift: A Podcast About Mobility
    • Special Reports Podcasts
    • Daily Drive Podcasts
    • AAM
    • Gentex
    • Reputation.com
    • Ricardo
    • Ricardo
    • Allstate: Want more from your F&I?
    • Ally: Navigating the future of automotive retailing
    • Amazon Web Services: Any place, any time, any channel
    • Amazon Web Services: The power of the cloud
    • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
    • Epic Games: Transforming the auto industry with digital assets
    • FTI Consulting: Crisis as a catalyst for change
    • Google: 5 trends shaping the auto industry's approach to a new normal
    • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
    • IHS Markit: Autonomous vehicles: Automotive and transportation disruption
    • IHS Markit: COVID-19: The future mobility delusion
    • IHS Markit: The battery electric vehicle (BEV)
    • Level5: 2020 Automotive E-Commerce Report
    • Naked Lime: Bring social reputation together as part of big-picture marketing
    • Wells Fargo Auto: Switching gears from LIBOR to SOFR
    • Ally: Do It Right
    • DealerSocket
    • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
    • Facebook: The road to a zero-friction future
    • Guide To Economic Development
    • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
MENU
Breadcrumb
  1. Home
  2. NADA Show
February 06, 2017 12:00 AM

Online car sales could soon be on fast track

Jamie LaReau
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    O'Neil on Internet sales: “It's a good thing.”
    If you could, would you?

    Here's what a survey found consumers felt about doing more of the vehicle purchase online. Percentages exclude respondents who said they were at a dealership for service, not to buy.

    Q: Based on your most recent experience buying or leasing a vehicle at the dealership, which best describes your sentiment?

    HOW MUCH COULD HAVE BEEN DONE ONLINE% OF RESPONDENTS
    "All of the process"5
    "Most of the process"15
    "Some, but not most"80
    Source: DealerRater survey of 7,184 dealership visitors conducted Jan. 17-23 on behalf of Automotive News

    After years of forecasts that the Internet would revolutionize auto sales, auto industry leaders say dealerships are within a year or two of being able to complete an entire vehicle transaction online. That includes pitching finance and insurance products and getting electronic signatures on key documents. There are even online leasing apps popping up, too.

    At some point, millions of consumers will use online sales technology, experts say.

    "Once you figure out it's a good thing, it takes off like crazy," Cox Automotive COO Mark O'Neil told the Automotive News Retail Forum on Jan. 26. "By the end of 2017, we are going to be leaving that, I'll call it, "slow growth, bumpy, experiment-with-it phase,' and we're going to start with the very rapid part of growth."

    O'Neil predicted nearly 10 percent of vehicle transactions could be online by 2019.

    Automakers and dealers are making significant investments in the technology to enable consumers to do most -- and someday, all -- of a vehicle purchase online. Those dealers who lag behind will have to catch up or face a fate similar to that of independent bookstores in the wake of Amazon, industry experts say.

    But they add that catching up will be possible. "You'll have the pioneers who'll go out there and draft the technology," said David Kain, president of Kain Automotive in Lexington, Ky. "What has historically happened is the smaller dealers and the midsize dealers are able to catch up."

    Kain Automotive provides digital marketing, sales training and consulting to dealers. Kain estimated that 10 to 20 percent of dealers have software that enables them to do a car transaction electronically up to delivery, at which point some state laws require certain documents have a wet signature.

    Toyota Marin has been using the online shopping portal Express Storefront, from startup Roadster, since last summer. The San Rafael, Calif., store sells around 40 vehicles per month almost completely online through the platform, said Mike Christian, Toyota Marin's general manager.

    Express Storefront is hosted on dealership websites. It enables shoppers to select a vehicle, get approved for credit, sift through F&I options and have the vehicle delivered to them, where they sign documents.

    Not everyone agrees this is the future. Some dealers say completing a car transaction online is years away because valuing a trade-in, arranging financing and complying with regulations make it too complex. Others warn that online deals open the door to cybercrime.

    There is also worry that F&I profits would decline without a face-to-face pitch. "But the studies we've seen show that consumers will actually buy more F&I products using iPads in a dealership on their own than a finance manager can sell them," Kain said.

    Online sales is one approach among many to selling cars, reflecting customers' varied preferences. Indeed, surveys show consumers are mixed in their views of online sales.

    DealerSocket's 2016 Dealership Action Report found two-thirds of franchised dealers believe consumers would like to complete the entire buying process online, but only one-third of consumers who were surveyed said they'd want to do so.

    In a survey of consumers who recently visited a dealership, conducted last month by DealerRater for Automotive News, 80 percent of respondents -- excluding those who said they were at the dealership for service -- said that "some, but not most" of the purchase process could have been done online.

    Still, some automakers and their captive finance arms are developing digital sales technologies.

    Ford Motor Credit Co., for example, said last month that it was partnering with financial technologies company AutoFi to enable customers to buy a vehicle straight from a dealership's website. It's up to the dealership to decide whether to offer home delivery. A pilot began at Ricart Ford in Groveport, Ohio, in December.

    Kain: Stores can catch up.

    'The future'

    Toyota is also "aggressively" working on online transactions, said Ryan Hensley, CFO of Bill Penney Toyota in Huntsville, Ala. Hensley wants that technology but worries about the cost, adding it is "years down the road" before full online transactions are commonplace.

    Kain, who has seen some of the automakers' online sales technology in action, said the industry is "months away" from full digital deals. It hinges on lenders' willingness to accept electronically signed documents, he said.

    Van Horn Automotive Group in Plymouth, Wis., is about half finished designing in-house technology to do a full transaction online, said COO Teresa Van Horn.

    "That is going to be the future," she said. "It's not completely here yet. There are many customers who still want to come in. But the next generation is used to being able to do transactions almost instantly. They want that convenience."

    Dealer Alex Perdikis, owner of Koons of Silver Spring, in Maryland, said he is increasingly delivering new and used vehicles to customers who never set foot in his dealership. They conduct most of the deal online, often on a mobile phone. A finance manager calls to negotiate terms and pitch insurance products. An employee delivers the car and gets paperwork signed then.

    Del Grande Dealer Group, in the heart of Silicon Valley, is building in-house technology to offer the full online car-buying experience with the click of a mouse. That includes price validation, trade-in options, choosing accessories, financing options, F&I product selection and pickup or delivery options, said President Shaun Del Grande. He said that by offering the same high-quality customer experience at the time of delivery as he would if a customer came into the stores, his dealerships can build a relationship with the customer. And in case the lack of a personal connection built during the sale hurts his service business, he's considering adding valet pickup and delivery for service customers.

    Alex Perdikis is increasingly delivering cars to customers who never set foot in his store.

    Publics' plans

    AutoNation Inc.'s AutoNation Express approach to online car buying is in all of its 260 stores. AutoNation CEO Mike Jackson said about 30 percent of its January new-vehicle sales were transacted online.

    Sonic Automotive Inc. will launch Sonic Digital One-Stop this year to enable consumers to shop for a vehicle, get a trade appraisal and complete the purchase online. A Sonic employee delivers the car to the consumer and gets signatures.

    In August, Asbury Automotive Group Inc. put online-selling software in about a dozen of its 84 stores. Last year, Penske Automotive Group Inc. put its Preferred Purchase online shopping tool in all 132 of its U.S. stores. Penske also is piloting an F&I product associated with Preferred Purchase in some stores. c

    Hannah Lutz, John Irwin and Vince Bond Jr. contributed to this report.

    RECOMMENDED FOR YOU
    Volvo rallies dealers on EVs, CPO participation
    Letter
    to the
    Editor

     

     

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Lithia CEO: Innovation drives profit
    Volvo rallies dealers on EVs, CPO participation
    Profitability, e-tron top Audi dealer concerns
    Profitability, e-tron top Audi dealer concerns
    Sponsored Content: A Playbook for Moving Your Dealership Forward
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please verify captcha.

    Please select at least one newsletter to subscribe.

    See more newsletter options at autonews.com/newsletters.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Digital Edition
    Automotive News 1-25-21
    THIS WEEK'S EDITION
    See our archive
    Fixed Ops Journal
    Fixed Ops Journal 12-14-20
    Read the issue
    See our archive
    Get Free Newsletters

    Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Today

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    Subscribe Now
    Connect With Us
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Our mission

    The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.

    AN-LOGO-BLUE
    Contact Us

    1155 Gratiot Avenue
    Detroit, Michigan
    48207-2997

    (877) 812-1584

    Email us

    Automotive News
    ISSN 0005-1551 (print)
    ISSN 1557-7686 (online)

    Fixed Ops Journal
    ISSN 2576-1064 (print)
    ISSN 2576-1072 (online)

    Resources
    • About us
    • Contact Us
    • Media Kit
    • Subscribe
    • Manage your account
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Automotive News
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS
      • Dealers
        • Access F&I
        • Fixed Ops Journal
        • Marketing
        • Used Cars
        • Retail Technology
        • Sales
        • Best Practices
        • Dealership Buy/Sell
        • NADA
        • NADA Show
      • Automakers & Suppliers
        • Automakers
        • Manufacturing
        • Suppliers
        • Regulations & Safety
        • Executives
        • Talk From The Top
        • Leading Women Network
        • Guide to Economic Development
        • PACE Awards
        • Management Briefing Seminars
        • World Congress
      • News by Brand
        • Aston Martin
        • BMW
          • Mini
          • Rolls-Royce
        • Daimler
          • Mercedes Benz
          • Smart
        • Fiat Chrysler
          • Alfa Romeo
          • Chrysler
          • Dodge
          • Ferrari
          • Fiat
          • Jeep
          • Maserati
          • Ram
        • Ford
          • Lincoln
        • General Motors
          • Buick
          • Cadillac
          • Chevrolet
          • GMC
          • Holden
        • Honda
          • Acura
        • Hyundai
          • Genesis
          • Kia
        • Mazda
        • McLaren
        • Mitsubishi
        • Nissan
          • Infiniti
        • PSA
          • Citroen
          • Opel
          • Peugeot
        • Renault
        • Subaru
        • Suzuki
        • Tata
          • Jaguar
          • Land Rover
        • Tesla
        • Toyota
          • Lexus
        • Volkswagen
          • Audi
          • Bentley
          • Bugatti
          • Lamborghini
          • Porsche
          • Seat
          • Skoda
        • Volvo
        • (Discontinued Brands)
      • Cars & Concepts
        • Virtual reveals (Sponsored)
          • GENESIS: 2021 GV80
          • KIA: 2021 K5
          • LEXUS: 2021 IS
          • NISSAN: 2021 Rogue
          • TOYOTA: 2021 Venza and 2021 Sienna
        • Auto Shows
          • Detroit Auto Show
          • New York Auto Show
          • Los Angeles Auto Show
          • Chicago Auto Show
          • Geneva Auto Show
          • Paris Auto Show
          • Frankfurt Auto Show
          • Toronto Auto Show
          • Tokyo Auto Show
          • Shanghai Auto Show
          • Beijing Auto Show
        • Future Product Pipeline
        • Photo Galleries
        • Car Cutaways
        • Design
      • Coronavirus Coverage
      • China
      • Shift
      • Mobility Report
      • Special Reports
      • Digital Edition Archive
      • This Week's Issue
    • OPINION
      • Blogs
      • Cartoons
      • Keith Crain
      • Automotive Views with Jason Stein
      • Columnists
      • China Commentary
      • Editorials
      • Letters to the Editor
      • Send us a Letter
    • DATA CENTER
    • VIDEO
      • AutoNews Now
      • First Shift
      • Special Video Reports
      • Weekend Drive
    • EVENTS & AWARDS
      • Events
        • Congress Conversations
        • Retail Forum: NADA
        • Canada Congress
        • Europe Congress Conversations
        • Leading Women Conference
        • Fixed Ops Journal Forum
        • ANE Shift
        • Shift: Mobility at a Crossroads
        • Shift: The Future of Mobility (CES)
      • Awards
        • 100 Leading Women
        • 40 Under 40 Retail
        • All-Stars
        • Best Dealerships To Work For
        • PACE Program
        • Rising Stars
        • Europe Rising Stars
    • JOBS
    • AN Solutions
    • +MORE
      • Leading Women Network
      • Podcasts
        • Shift: A Podcast About Mobility
        • Special Reports Podcasts
        • Daily Drive Podcasts
      • Webinars
      • In the Driver's Seat
        • AAM
        • Gentex
        • Reputation.com
        • Ricardo
        • Ricardo
      • Publishing Partners
        • Allstate: Want more from your F&I?
        • Ally: Navigating the future of automotive retailing
        • Amazon Web Services: Any place, any time, any channel
        • Amazon Web Services: The power of the cloud
        • Amazon Web Services: Universal translator: Harnessing sensor data to build better automotive software
        • Epic Games: Transforming the auto industry with digital assets
        • FTI Consulting: Crisis as a catalyst for change
        • Google: 5 trends shaping the auto industry's approach to a new normal
        • IHS Markit: Automotive loyalty in the wake of the COVID-19 recession
        • IHS Markit: Autonomous vehicles: Automotive and transportation disruption
        • IHS Markit: COVID-19: The future mobility delusion
        • IHS Markit: The battery electric vehicle (BEV)
        • Level5: 2020 Automotive E-Commerce Report
        • Naked Lime: Bring social reputation together as part of big-picture marketing
        • Wells Fargo Auto: Switching gears from LIBOR to SOFR
        • Ally: Do It Right
        • DealerSocket
        • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
        • Facebook: The road to a zero-friction future
        • Guide To Economic Development
        • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
      • Classifieds
      • Companies on the Move
      • People on the Move
      • Newsletters
      • Contact Us
      • Media Kit
      • RSS Feeds