GM Teams With Dealers To Sell Cars Online

Computerworld - Details on the still-unnamed company remain sketchy, but General Motors Corp. and several dealers last week unveiled a dot-com initiative aimed at competing against popular online brokers such as Autobytel.com Inc.
In recent months, automakers such as Dearborn, Mich.-based Ford Motor Co. have also launched projects with dealers to configure and sell cars online.
But analysts said automakers still need to address dealer business models, which are becoming obsolete in the wake of growing numbers of Internet-informed consumers.
In a pilot Web site due to launch this fall, the GM/dealer venture will offer data on competing vehicle models and pricing, along with access to GM vehicle inventories. It will also give consumers the ability to purchase vehicles online from participating dealers.
The joint venture is open to all of GM's 7,700 dealers, officials said.
Popularity Contest
Automakers' Web sites haven't been as popular with consumers as the sites of car brokers like Autobytel.com.
GM said hits on the sites of online brokers outnumbered hits on its own GMbuyer.com site by a margin of 3 to 1.
Mike Glut, business development director at GM, attributed the comparatively lower traffic on GM's consumer site to the lack of competitive information. "Consumers want to get all their information in one place," he said.
But the new venture seeks to offer more than that capability, said Robert DiSisto, an analyst at Gartner Group Inc. in Stamford, Conn.
"The goal is to get more [consumer] data to help make GM more effective in its selling and marketing strategies," said DiSisto.
Dealers control most of that information now, as local franchise laws prevent automakers from selling cars directly. But online brokers have cropped up as intermediaries between the dealers and consumers.
But ultimately, DiSisto said, "the automakers need to help their dealers change business models to be more service-oriented, as opposed to oriented to making profits from selling vehicles."
Jerry Seiner, who operates three GM dealerships in Salt Lake City and is a founding member of GM's new joint venture, said many dealers are changing the way they do business in response to lower margins on cars.
"We are a click-and-brick industry, and many dealers are looking at other profit centers in the future," such as repair services and vehicle financing, said Seiner.
GM and participating dealers will evenly split the ownership stake and funding of the venture. Detroit-based GM didn't furnish details on the cost or technical infrastructure required to build the site.