In an article published last month in Business Insider, reporter Eugene Kim revealed a plan by online retailer Amazon to enter the $1.2 trillion dollar auto market by partnering with Fiat Chrysler to sell three top models in the auto makers product line. To test the approach in a test tube of sorts, Amazon will only offer the car purchase option to buyers in Italy.
One goal of the plan is to test the feasibility selling cars over the Internet and includes three top Chrysler Fiat models – the Fiat 500, the 500L and the Panda.
Referring to a Reuter’s news agency report, Kim writes that Amazon believes the approach will give the its’ digital marketplace a hefty price edge of roughly 30% off prices offered by brick and mortar dealerships.
According to DealSure, a consumer protection agency for car buyers who subscribe to its online service, Amazon’s plan still relies on dealerships to take delivery of a car purchased on Amazon and release it to buyer.
DealSure President and CEO Andy Gellert was quick to point out the weak link in Amazon’s marketing model – dealerships who use tricks and tactics to inflate a car’s selling price. Gellert said that:
Consumers who subscribe to DealSure for just $39.99 a year won’t be going it alone even if they use Amazon’s service to purchase their next car. A DealSure auto buying or leasing expert will still go over the terms of a sales contract… check the financing interest rate… and make sure buyers benefit from all the rebates, factory incentives and other extras they are entitled to receive.
News of DealSure and its consumer protection service comes not a minute too soon.
Three months ago, Amazon launched “Amazon Vehicles” – an experimental website that allows users to read and post reviews while they browse the features and options available on thousands of different car models.
Industry experts believe Amazon’s new website is an effort to measure consumer interest in an arms-length car buying service that doesn’t allow the consumer to kick the tires and soak up that “new car smell”.