Going, Going, Gone?

General Motors tried selling new cars on eBay Motors last year. That lasted eight weeks. Now, Kia Motors America gives it a shot, presumably expecting greater longevity for its new program that lets people bid online for select inventory that dealers offer. Why should Kia succeed where GM failed? Well, look at the differences between what GM did and what Kia is doing. GM limited its brief project

General Motors tried selling new cars on eBay Motors last year. That lasted eight weeks.

Now, Kia Motors America gives it a shot, presumably expecting greater longevity for its new program that lets people bid online for select inventory that dealers offer.

Why should Kia succeed where GM failed? Well, look at the differences between what GM did and what Kia is doing.

GM limited its brief project to California dealers. GM planned to go national if the experiment worked. It didn't make it out of the test tube.

In contrast, more than 345 Kia dealers in the U.S. are participating in what Kia bills as the “first nationwide dealer online new-car shopping experience.”

GM launched its eBay innovation in July, 2009, when the auto maker was ill and on government life support.

It had just emerged from bankruptcy. Its dealers — the ones not eliminated in a massive reduction plan — were in a survival mode, not in a mood to play around with new Internet ventures.

Besides, some skeptics questioned GM's sincerity in announcing its eBay partnership. They suspected the ailing auto maker was just trying to show it wasn't as calcified as critics had claimed.

Kia, on the other hand, launches its eBay effort while on a roll. Kia and its sister brand, Hyundai, are hot franchises with strong sales and lots of new products.

It seems as though either or both South Korean brands constantly are launching something new, from a vehicle buy-back program for customers who lose their jobs, to a “valet service” that brings high-end cars to prospective buyers' homes and places of employment so they can skip a trip to the dealership.

And now Kia kicks in with this new online program. Shoppers who type in their zip codes at www.kia.ebay.com can check out biddable new cars. Registering and supplying contact information qualifies them to make offers dealers may or may not accept.

Visitors also can use the website to arrange conventional offline things, such as schedule dealership appointments and set up demo drives.

Ray Fenster swears selling new cars on eBay works. He became a pioneer of doing that three years ago when he was e-commerce director for the Lindsay Automotive Group based in Washington DC.

Some dealers are doubtful, but Fenster notes the set-up allows dealers to maintain control by setting minimum bids, picking what inventory to post and ultimately deciding whether to accept a bid.

His experience was that eBay car buyers tended to be just that — buyers “ready to pull the trigger” — not iffy shoppers.

If the process sounds familiar in a conventional sense (dealers setting a price, customers offering another) at least it's yet another channel to sell cars in modern times. Kia says it is taking advantage of the fact that about 80% of car shoppers visit third-party automotive websites.

“Attracting vast online audiences to Kia through a pleasant online purchasing experience furthers Kia Motors' sales and marketing strategies,” says Tom Loveless, KMA's vice president-sales.

Who knows? If it's a hit for Kia, maybe GM, feeling much better these days, will try it again.

TAGS: Dealers Retail
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