Hyundai Is First Automaker to Sell New Cars on Amazon

From a Wall Street Journal story by Ryan Felton and Sean McLain headlined “Hyundai to Be First Automaker to Sell New Cars on Amazon”:

Hyundai customers who want to skip going to a dealership will have a new option next year: shopping on

The South Korean automaker announced the move Thursday with Amazon at the Los Angeles Auto Show. Starting in 2024, U.S. auto dealers will be able to sell new vehicles on the tech company’s platform, making Hyundai the first automotive brand to offer such an option for customers.

“Despite the industry’s focus on improving this experience, customers continue to express frustration with the process,” José Muñoz, chief operating officer of Hyundai Motor said at the LA Auto Show. “They see how easy it is to buy all the products on Amazon, and they want that convenience when buying a car.”

The companies said the arrangement will allow customers to purchase a new car on Amazon from a local dealership and then either pick it up or have it delivered.

Prospective buyers will be able to search on Amazon’s website for available vehicles in their area by model, color and features, and then complete the process using their chosen payment and financing options.

As part of the companies’ partnership, Hyundai will include Amazon’s Alexa technology in the brand’s cars beginning in 2025, the companies said.

The plan underscores how the traditional car-buying experience is continuing to be upended for the automotive industry. During the Covid-19 pandemic, automakers expanded at-home delivery programs during coronavirus-related lockdowns, while dealers broadened their websites to help customers tour showrooms virtually.

Hyundai said that initially only 15 to 20 dealers will be able to sell their vehicles on Amazon, but that it will expand it to more by the end of next year. “Is this going to help us sell more cars? We believe so,” said Muñoz.

Amazon said it expects to increase car brand offerings on its platform by the end of next year as well.

Consumers in recent years have warmed to the idea of skirting the car dealer, particularly when it comes to newer electric-vehicle models.

More EV buyers in 2022 were open to the idea of buying a car fully online compared with gas-powered vehicle buyers, according to a study from Cox Automotive, an industry-research firm. Customers who completed more than half of the car-buying steps online were the most satisfied among all buyers in the study, Cox said.

EV market leader Tesla pioneered the direct-to-consumer sales approach in the industry, a model that has since been adopted by competitors such as Rivian and Lucid, which have also chosen to avoid relying on traditional car dealers.

Hyundai and Amazon said the new arrangement would create another way for dealers to build awareness of their selection and offer a convenient buying option to customers.

“What we see here is a highly competitive industry, but that is also edging towards e-commerce and we really think we can help customers here,” Fan Jin, Amazon’s director of vehicle sales, said at the auto show. Jin declined to say how Amazon would make money on vehicle sales.

Los Angeles-based auto dealer Mike Sullivan said he has made e-commerce sales and home deliveries for years. But the new partnership between Amazon and Hyundai will help him better serve the needs of today’s customers.

“We know we’ve got to meet our customers where they are, and much of that time, that’s on their phone or laptop,” Sullivan said at the auto show.

Some auto execs have taken note of Tesla’s success using its approach and say they are looking to revamp how they sell cars as more electric vehicles are introduced to the public. Established carmakers such as Ford Motor are bound in part by franchise laws to use independent dealers, after lobbying by auto retailers over the years to build in better protections for their operations.

Ford has adopted new rules for U.S. dealers looking to sell the company’s electric vehicles, including requiring no-haggle pricing. The Dearborn, Mich.-based automaker’s chief executive, Jim Farley, has been particularly outspoken about the need to revamp how cars are sold, saying the direct sales approach can save about $2,000 a vehicle.

Ford plans to provide EV customers with more-flexible purchases online starting next year, with transparent pricing and remote vehicle delivery, executives have said.

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