Amazon Next year will allow car dealers to sell cars through their website, starting with South Korean automaker Hyundai, the company said Thursday.
The company has slowly made its way into the car-buying business over the years, launching digital showrooms on its site for customers to research and compare vehicles, but without buying them directly through Amazon. Users can also buy auto parts, such as replacement parts, through their website.
Starting in 2024, Amazon will allow customers to buy a new car online, then have it picked up or delivered by their local dealers. Consumers will be able to find the vehicles available in their area, make a selection, then check out on Amazon using their preferred payment and financing method. The company said the new feature will create “another way for retailers to raise awareness of their selection and offer convenience to their customers.”
Amazon CEO Andy Jassy said the partnership with Hyundai will “change the ease with which customers can buy vehicles online.” As part of the deal, Hyundai will also include Amazon’s Alexa voice assistant in its cars from 2025.
Sections of used car dealers such as Carmax and Caravan as well as the nation’s largest publicly traded new car dealer Lithia Motors and Autonomy it collapsed after the announcement. Shares of these companies closed between 5% and 6% on Thursday.
With the move, customers will be able to buy cars on Amazon, but the seller will still be the final seller. Traditional manufacturers such as Hyundai have complicated relationships with dealers that are supported, in many states, by laws that make it difficult or illegal to bypass franchise and new vehicle dealers. to sell directly to consumers.
Tesla and other electric vehicle startups such as Riabha has developed approaches in many states to sell vehicles directly online to consumers. They include starting sales in states that do not prohibit the practice, or taking legal action to fight against these laws, as they did in Michigan.
There are less strict laws regarding the sale of used vehicles, which makes it easier for companies like Carvana and others to sell pre-owned cars and trucks online directly to consumers.
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