Amazon The company said Thursday that auto dealers will be allowed to sell cars through its site next year, starting with South Korean automaker Hyundai.
The company has gradually stepped up its move into the car-buying business over the past few years, launching digital showrooms on its site for buyers to research and compare vehicles but not buy them directly through Amazon. Consumers can also purchase car products, such as replacement parts, through its site.
Starting in 2024, Amazon will let buyers buy a new car online, then pick it up or have it delivered by their local dealership. Consumers will be able to search for available vehicles in their area, select, then check out on Amazon using their preferred payment and financing method. The company said the new feature will “create another way for dealers to create awareness of their selection and provide convenience to their customers.”
Amazon CEO Andy Jassy said the partnership with Hyundai will “make it easier for customers to buy vehicles online.” As part of the deal, Hyundai will also include Amazon’s Alexa voice assistant in its cars starting in 2025.
Shares of used car dealers like carmax And CARVANA as well as the country’s largest publicly traded new car dealer Lithia Motors And autonation Fell after announcement. Shares of those companies closed between 5% to 6% on Thursday.
With this move, buyers will be able to buy cars on Amazon, but the dealer is still the final seller. Traditional automakers like Hyundai have complex relationships with dealers, supported by laws in many states that make it difficult or illegal to bypass franchised dealers and sell new vehicles directly to consumers.
Tesla And other electric vehicle startups like Rivian Workarounds have been developed in many states to sell vehicles online directly to consumers. These include resuming sales in states that do not outlaw the practice, or taking legal action to fight such laws, as they have done in Michigan.
There are less stringent laws regarding the sale of used vehicles, making it easier for Carvana and other companies to sell pre-owned cars and trucks online directly to consumers.
