As we near the year’s end, the early Thanksgiving displays at Home Depot serve as a reminder that 2025 is just around the corner. This impending deadline means that Hyundai and Amazon have limited time left to fulfill their commitment to launch a digital car-buying platform within this year, a situation that is increasingly frustrating for dealerships.
Last year, Hyundai and Amazon announced their collaboration aimed at creating a digital marketplace allowing customers to choose a vehicle, apply for financing, and complete their purchase without the traditional dealership experience. While buyers would still need to visit a dealership for final paperwork and car delivery, the majority of the process could be handled remotely. However, it appears that both Hyundai and Amazon underestimated the complexities involved in the U.S. car-buying landscape, including dealership networks and state franchise regulations. As a result, despite initial assurances, they remain stuck in the beta phase.
“Amazon announced this about a year ago and they’re still not out of pilot,” Mike Stanton, CEO of the National Automobile Dealers Association (NADA), stated in comments to Automotive News.
Stanton added, “What I am hearing right now is that the dealers are frustrated. They’re not there yet with the agreement. It appears to be another digital retailing tool at the moment and probably not top tier.”
When visiting Amazon’s “Hyundai Evolve” hub, users will find it largely mirrors the information available on Hyundai’s main website. Shoppers can view the vehicles Hyundai offers, but they won’t find specific cars located at dealer lots. Information about Hyundai’s maintenance programs, warranties, and electric vehicle charging is available, but this is easily accessible through a simple Google search. The section titled “Purchase Hyundai Vehicles on Amazon” leads to a popup that merely outlines the upcoming program.
In fairness to Hyundai and Amazon, there is still time left in 2024 for the program to launch. If it can effectively reduce the hassle traditionally associated with car buying, it may very well be worth the wait. However, dealers are concerned that the project is incomplete. “They still haven’t established a framework that allows dealers to engage with multiple banks or handle trade-ins, so I believe more developments are coming,” Stanton remarked.
Dealerships also risk losing out on accessory sales. If a customer purchases a Hyundai through the Amazon platform, they are engaging with a company that possesses their purchase data. Consequently, Amazon can market accessories tailored to customer preferences, potentially steering them to buy items like floor mats or cargo nets directly from Amazon instead of the dealership. This shift may not sit well with sales personnel.
Despite the challenges faced by dealerships, one might question whether they deserve sympathy. If Hyundai can simplify the car-buying experience effectively, it’s a move worth pursuing. Nevertheless, it appears that the complexities of this initiative are proving more difficult than anticipated for both Hyundai and Amazon, indicating that significant work remains even a year after its announcement.
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