Germany’s Lidl chain of low-cost grocery stores has begun selling Opel Corsas and VW Polo Crosses online, reports The Age. In partnership with German distributor ATG-Automobile, Lidl is selling the subcompact commuters at about 25 percent below the suggested retail price (11K euros for the Corsa, 14K euros for the VW), offering Germans a new, low-cost way to cash in on Germany’s clunker-culling measure. Some argue that the online sales approach has been tried without success, as Germans prefer to do business with a dealership. “I think it will be very difficult for Lidl,” says Ferdinand Dudenhoeffer of Gelsenkirchen’s Center for Automotive Research. “People don’t want to buy high-value products from a discount grocery store.” Noting that Quelle, a German online marketplace, tried to sell cars online about five years ago, Dudenhoeffer says “it didn’t work, even though their site was visited fairly heavily.” As the automotive industry reinvents itself, however, OEMs will look to every possible sales outlet, transforming the dealer-only approach that has defined the business for years. Whether this approach pays off remains to be seen.
If motor-mouth Dudenhoeffer says it won’t work, then I have all confidence that it will.
The EU Block Exemption Law allows this expressly. Manufacturers must honor the warranty.
http://www.lidl-shop.de/de/Motorfreunde@shop@ProductCategories?categoryId=241
If I could buy a car from HEB, I would, as long as it wasn’t a cheap knockoff of one of the established manufacturers :)
If the car I wanted to buy could be had for cheaper at Wal-Mart, I’d be all for it. Perhaps by the time I’m in the market for such a thing, this will be a reality here in America as well. It does make you wonder how dealership services would work, though.
Well, it’s old-fart nothing-new-under-the-sun time again. In 1951 Kaiser/Frazer came out with a compact car called the Henry J. This was a fastback 2-door with a jeep-like 4-banger engine. At around the same time they announced that there would also be a version called the Allstate, sold through Sears Roebuck stores. I don’t recall ever seeing an Allstate though, so I don’t know if the arrangement worked at all.
In 1953 (I think) they made the flathead 6 from the full-size Kaiser available in the Henry J; a friend had one, said it was a pretty good performer.
It does make you wonder how dealership services would work, though.
Simple: You take the car to the next Opel or VW dealer and have it fixed under warranty. They must. And in case Opel or VW give you problems, someone in Brussels will be all ears.
This is how you should buy a car. It’s about time.
fincar1:
Wow, I knew Allstate sold some rebadged Vespas, but I didn’t know about the car.
Here is a somewhat good link on it:
http://auto.howstuffworks.com/allstate-cars.htm
Probably one reason the Allstate failed is that the regular Kaiser-Frazer dealer had a cheaper, more basic version of the car. Even back then going to Sears for the “premium” version of something was probably a bit counterintuitive.
I think Americans would be much more accepting of this now, but it would be very hard to implement because of state franchise laws.
In most states it probably wouldn’t be too hard to make Wal-Mart or Costco a dealer, but then if a manufacturer wanted to cancel the store’s contract it would have to pay the store huge amounts of money.
Heck, last time I was at Costco, they tried to sell me a car. So what’s the big deal? Or is that why I quit going to Costco? Or was it that nothing I wanted to buy at Costco would fit in my Miata?
Such type of sale may be good for a gimmick, but is no serious competition for the car dealers.
I can see myself test driving a car at a brick and mortar establishment then buying it online. After test driving the same model at one dealer, after searching the internet, I bought it from another dealer for $2k less than the first dealer would sell it for. I don’t see why I would feel any different about doing it entirely on-line.
Before the European Block Exemption (pretty much) fell after decades of fights, the argument went: “If this law gets enacted, cars will be sold in supermarkets.”
Well, it’s time that prediction comes true. Whether it will work or not doesn’t need to be debated. It just needs to be watched.
What most car manufacturers are forgetting is that only a small fraction of car owners buy their cars new. Sure – those are the only ones usually seen at a car dealer because the majority of people who buy older cars do not service them at franchised dealers either. When doing some research on that I was shocked to what extent the servicing dropped at franchised dealers after the cars reached three or more years of age, and went to independent garages instead.
But back to the group of people who do not generally go to car dealers. If you make them a good offer (and the prices shown by Lidl certainly seem attractive, especially if you subtract the 2.5k EUR for the Abwrackpraemie), you could easily lure in people who would otherwise not buy a new car. And as they never used a franchised dealer before, they may well have less of a problem worrying about where to get it fixed.
Bertel Schmitt,
I read you first comment with much interest (and amusement). Prof. Dudenhoeffer does seem to perceive himself as some sort of minor automotive deity in the German speaking world. When we wanted to interview him for a project in Germany (which the client suggested), he said he does not deal with ignorants more or less (in spite of all of us having PhDs in related areas) but that if we have any questions, he’d gladly sell us a 2 page summary on the subject area in question. The client (a very large German automotive company) then very kindly told him where to stuff it ;)
Any astounding research he did, which made him lose perspective, of sorts?
You’re close, fincar1. The Kaiser Henry J (the president of the company being, of course; Henry J Kaiser) came out in 1951, the Allstate version came out in 1952 (gussied up a bit, with Sear Allstate battery and premium tires, Allstate spark plugs, even, apparently… and improved interior) and could be had mostly in the south, at Sears Roebuck stores or purchased through the catalog. Just as Sears had done early in the 20th century, with Sears highwheel horseless carriages.
The big ex-Continental 226 L-head six never went into the Henry J / Allstate nor the later sporty fiberglass 2 seat Kaiser Darrin convertibles based on the Henry J chassis; it was too long.
The original Henry J and Allstate used L-head inline four engines almost exactly the same as the Willys Jeeps, and L-head (161 cubic inch) inline sixes almost exactly the same as the Willys station wagon or pickup, because Kaiser bought engines from Willys.
Then, in 1953, Kaiser actually purchased Willys.
You’re thinking of the Willys Aero, which had an uprated F-head (intake in head, exhaust in block) 161 six, then when Kaiser bought it, the engineers shoe-horned the 226-6 L-head into it. Some engineers even tried out the supercharged version in the lightweight Willys Aero and it was a real hot-rod…
The 161 six in the Henry J had a LOT of performance for the day because it was a very light car. (And very very cheap – just not “inexpensive to buy” – hence its failure).
How long before Wal-Mart start selling Brilliance automobiles, or maybe DongFeng, or BYD or Geely (all built in CHINA but possibly “assembled” in Mexico to take advantage of NAFTA), sold as some made-up name or maybe with some old name such as “Rambler” attached to it? I’m going to guess, within 3 to 5 years. What is the Wal-Mart “generic” brand? Equate.
“What do you drive?” “I have an Equate X35 sedan. What about you?” “I’ve got a Rambler Cross Country Six crossover wagon”.