Amazon has unveiled its initiative to enable auto dealers to sell cars on its platform, beginning with a collaboration with the South Korean automaker Hyundai. Although the company has previously introduced digital showrooms for vehicle research, the direct purchase of cars on Amazon’s site was not available until now.
In the coming year, Amazon plans to broaden its automotive offerings, allowing consumers to purchase not only car products like replacement parts but also new cars online, with the feature set to launch in 2024. Shoppers can choose a vehicle from local dealerships, complete the transaction on Amazon, and opt for either car pickup or delivery.
This innovative feature is poised to enhance convenience for consumers, enabling them to search for available vehicles, make selections, and finalize transactions using their preferred payment and financing methods. Amazon asserts that this initiative will offer dealers an additional avenue to showcase their inventory and provide added convenience to their customer base.
Amazon CEO Andy Jassy highlighted the revolutionary aspect of the collaboration with Hyundai, emphasizing its potential to simplify the online car-buying experience for customers. As part of this partnership, Hyundai vehicles will integrate Amazon’s Alexa voice assistant, scheduled to be integrated into cars starting in 2025.
Despite Amazon facilitating car sales, it’s crucial to note that the dealer remains the ultimate seller in this arrangement. Traditional automakers, like Hyundai, often have intricate relationships with dealerships, protected by state laws that regulate or prohibit the direct sale of new vehicles to consumers without involving franchised dealers.
In contrast, companies like Tesla and electric vehicle startups, such as Rivian, have navigated around these restrictions in various states. They achieve this by originating sales in states where such practices are legal or by taking legal action against restrictive laws, as witnessed in Michigan.
While stringent regulations exist for the direct sale of new vehicles, the landscape is more lenient for used vehicle sales. This flexibility allows companies like Carvana to sell preowned cars and trucks directly to consumers online, capitalizing on a more permissive legal environment for the used car market.