E-commerce has increasingly become a platform for big-ticket purchases like TVs, mattresses and cars. Car buyers can not only complete online before stepping into a dealership, but in some cases, they can buy cars directly from web-based vendors, cutting out the traditional dealership entirely.
Sites like Carvana allow customers to buy a car online and then pick it up, or even have it delivered to their driveways. Meanwhile, behemoth retailer Amazon has started testing online car sales in Italy and recruiting top car executives in Europe – both signs that the e-commerce giant is positioning itself to enter the automotive sales industry in a big way.
Additional disruptive forces for traditional dealerships include the development of self-driving cars and vehicle subscription services. AutoNation, the largest new vehicle retailer in the U.S., has partnered with Waymo, Google’s self-driving car partner, to provide maintenance for driverless cars. Waymo also negotiated a partnership with Lyft for the development of a driverless ride-sharing service.
Another emerging business model is vehicle subscription, which gives customers the option to rent cars on a month-to-month basis. These services are quickly adding more affordable models to their lineups, and users sometimes have the option to change what type of vehicle they rent based on their needs that month. Ford and Cadillac are two brands that currently offer subscription services in select markets.