Starting in 2024, people in the market for a car for the first time will be able to buy a vehicle on Amazon, the e-commerce giant and Hyundai Motor Co. announced on Thursday.
Dealerships will be able to sell the Korean company’s vehicles directly to customers on Amazon’s website, which currently lets people pick a vehicle from multiple manufacturers but not actually make the purchase. Customers who buy a Hyundai on Amazon will have the choice of picking their vehicle up at a nearby dealership or having it delivered.
“This new shopping experience will create another way for dealers to build awareness of their selection and offer convenience to their customers,” Amazon and Hyundai said in a blog post.
The developments are part of a trend of “offering up digital automotive retail channels, which are seamless and familiar experiences for today’s consumers,” Edmunds told CBS MoneyWatch in emailed comments.
“Our experts say the Amazon collaboration wouldn’t be starting that trend since digital retailing has already grown significantly, spurred on by the pandemic. Rather, Amazon is simply a well-known name playing in that space,” a spokesperson for the online car reviewer said.
“Consumers want to buy cars online but also want the option to use digital tools while at the dealership,” Lori Wittman, president of retail solutions at Cox Automotive, told CBS MoneyWatch, citing a study released by Cox on Friday. “The consumers’ comfort level with making a purchase of this magnitude online is what will move digital retailing into the automotive mainstream.”
Under the partnership, Amazon will effectively serve as the middleman between the buyer and the dealership, as car manufacturers are limited or prohibited from selling vehicles directly to consumers in nearly all 50 states.
Any impact on new vehicle cost is hard to predict given that Hyundai didn’t outline how pricing would be set on Amazon, with pricing likely to still be set by local dealers, according to Edmunds.
Tesla has skirted those rules by selling its cars directly through its website,by dealerships in numerous states.
In addition to virtual showrooms, Amazon’s site already offers car parts and other related products, including tires.