GM wants to sell cars online

The automaker is hoping to grab more consumers through the Internet, and is expanding its shopping tool.

By Motley Fool Investor Beat Oct 7, 2013 2:36PM
Detroit automaker General Motors (GM) is planning to expand "Shop-Click-Drive," an online shopping tool that gives customers the option of avoiding the showroom when purchasing a new vehicle.

Motley Fool analyst Jason Moser likes this move by GM. E-commerce sales are still a very small sliver of the retail economy, meaning there is plenty of room for continued growth. It's not typical for buyers to purchase higher-cost items like automobiles online, but the shift to e-commerce is is very real.
Jason sees a few significant hurdles for General Motors. It may be difficult to convince consumers that a purchase as large as a new car should be done online.

Additionally, General Motors' dealers may buck the trend. Dealers aren't required to take part in this rollout, and GM has admitted some have rejected the offer. Dealers who have invested lots of capital in renovating showrooms may balk at GM's new program. General Motors headquarters in Detroit, Mich., on June 6, 2013 (© Jeff Kowalsky/Bloomberg via Getty Images)

General Motors' stock may be up 22% year to date, but Jason still has reservations about the company.

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Tags: GM
114Comments
Oct 7, 2013 6:55PM
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So I guess people will just go down to their local dealer, try it out and if they like it then buy it online.

 

Great let's cut the "middle man" out of everything and see who's still left working to buy anything.

Oct 7, 2013 2:55PM
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Jason sees a few significant hurdles for General Motors. It may be difficult to convince consumers that a purchase as large as a new car should be done online.

 

Consumers should be able to buy anything they want online. If I can buy a 1,000 shares of MSFT online then why not a Ford Focus. Of course the good ole boy clubs like the Texas Auto Dealers will try and stop that with every tool available. Same goes for a 1,000 shares of Apple and a $487,000 home. If I can apply and complete the loan application then why not all those home closing documents and let's eliminate the stupid 6% Realtor commission too.

Oct 7, 2013 5:08PM
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Sounds great in theory. Buy a car online and skip out on the dealership. What happens when your new car comes in and you hate the blind spot in the rear or you can't stand the way the seat feels. Can't take a car back to the internet like you take a pair of jeans back to store. You still need the dealerships to touch and feel the product to see if you even like it.

Oct 7, 2013 7:32PM
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as a dealer most dealers have a dealer agrement with the banks that the paper work has to be done in the store and who going to notarize the title papers . oh and who are you going to call when you have a problem GM LOL i can see it now where is all the dealers to help me and one more do any of you get up every day and go to work for free i dont think so . the problem is there are some bad dealers out there that want to rip people off and there are some good dealers out there that want to take care of there customers  most new cars dont  have all the mark up you think we do
Oct 8, 2013 6:36AM
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To all those complaining about the bailout of GM.They are paying back the money!!And to those who say that their products aren`t worth buying,how about the ratings on the 2014 Impala and Malibu?Do you complain when we send Billions to other Countries,with no hope of being paid back?
Oct 7, 2013 9:04PM
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I ordered a new 1973 Vega from the PX in Germany and picked it up in KC when i got back to the world. What's the difference ?

  Saturn had a "one price" policy and I definitely agree with that concept.

Oct 7, 2013 8:50PM
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Of course it is always better for large corporations to make maximum profit for the least amount of effort.  The dealerships, like them or not, are the only place to take a vehicle for warranty repair.  This is just one more example of America not wanting to pay a fair price for anything and we will only buy if it is sold cheap.  Check the Walmart business model and see where this goes.  More people on working welfare and minimum wage.  If the dealerships and repair shops close where are you going to go for repairs, test drives, free hot dogs, tent sales and balloons.  Nothing is for free and sometimes cutting corners just gets you left short.
Oct 7, 2013 9:42PM
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If you buy online how are you going to test drive the vehicle you are about to purchase?
Oct 8, 2013 10:29AM
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Most people cant even operate their DVD/VCR and many other household electronics and have no clue to maintenance intervals. And you expect to purchase on line and be able to even turn  the radio on let alone use the Bluetooth, navigation system, driver information center and climate controls. Good luck with that. I bet dealers could offer a "get to know your vehicle" class and charge a pretty good price, or you waste the money you paid for options and cant use them. Dealers will be loyal to the customers who purchase from them and the internet purchasers will have to take a back seat, at least that is what I would do.

Oct 7, 2013 4:40PM
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This is exactly what I tried to do a couple years ago with all the online "car buying" websites.  Sure, I got info I needed on models and price ranges - but at the end of it all, they said to contact the dealers in person.  Right - that's just what I didn't want to do - get bogged down at showrooms with salespeople.  So I had the dealers contact me via email with quotes.  Some of them refused ("you just HAVE to see this car to believe it!!!"), some just gave me the MSRP, only a couple had any real savings.  I picked one, made an appt to buy the car WITH CASH, no trade in.  And had to spend SIX HOURS in the showroom.  That is what "buying a car online" is.
Oct 8, 2013 10:01AM
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If the portal is anything like the Obamacare portal, GM better forget it
Oct 8, 2013 10:32AM
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Be cold day in hell when I purchase a car online. Only a total dumb **** would do that.
Oct 8, 2013 8:34AM
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Selling online saves a lot of overhead i.e. payroll, rent, inventory stocked at one location, utilities.

 

But, it's also a job killer.   Most fulfillment companies ( Amazon ) are expected to hire more, while the brick and mortar stores are hiring less.  It's not an even exchange though, one fulfillment worker takes the place of up to 6 ( or more ) traditional retail staff

Oct 8, 2013 9:55AM
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So who appraises and buys the trade?   Who services the vehicle/handles complaints/warranty issues etc.?  Who employs the thousands upon thousands of now unemployed dealership salespeople?  Agree there are "bad" dealers, just like bad lawyers, doctors, teachers, store owners etc.  Just like there are "BAD" customers, who are never satisfied and forever suspicious and unhappy.......internet purchases are for them.  They're used to being on hold for 22 minutes to answer a simple question.   
Oct 7, 2013 4:41PM
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Tax free?

 

Let's do it! (does it have to be a GM?)

 

Will it be an obnoxious website?...you know...to simulate the experience?

 

 

Oct 7, 2013 6:44PM
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should read "GM needs to sell cars"

I may consider GM again, if we tax payers ever get the bail out money back, and Ford isn't avaiable.
Oct 7, 2013 11:22PM
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Recently had a conversation with the managers of a huge dealership where the topic of conversation was about the real cost of vehicles leaving the factory. I thought they were kidding and asked what they thought it was. A couple did not give a guess and some guessed way off. They knew before I retired I was in manufacturing cost control. Manufacturers aim for a cost to suggested retail of 33% or less. Example is a window sticker of $30,000 cost about $10,000 to produce. New car sales are so competitive that about $300-500 swing is about the most you will see. If you are trading, have your trade value printed out with you when you shop. Have your credit report printed out also. Be aware of manufacturers incentives on your chosen vehicle. PURCHASE NO EXTRAS, the new car warranties are 36 to 48 month bumper to bumper. Lastly have a loan interest rate from your lending institution on your chosen vehicle. Now you are ready to negotiate with the dealer. By the way if the exact vehicle is not in stock, the dealer can order it and be delivered in about six weeks.

Oct 8, 2013 8:42AM
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I remember Tesla wanting to do this in my state but they were denied. I remember GM and the Feds being one of the biggest opponents of this. It sounds like the Fed saw that Tesla was spanking GM and shut down Tesla from gaining in the market by shutting them out of the internet sales then stole Teslsa's idea. Doesn't suprise me, what does suprise me is the blinders most Americans won't take off when it comes to our Federal governement.
Oct 8, 2013 12:05PM
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I'll bet most of the people on here couldn't even get financed with out a dealers help!!!!!
Oct 8, 2013 10:26AM
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tryin to hurt the lil guy what about the salesman out there that's govt motors for ya
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