Amazon appears to have embarked on a programme of retail executive recruitment ahead of a plan to launch a pilot automobile sales arm in the UK. The company’s eCommerce delivery partner, ParcelHero, has warned traditional car retailers that Amazon’s new venture is about to transform the market.
David Jinks, ParcelHero’s Head of Consumer Research, has been quoted as saying that “the likes of Evans Halshaw and Bristol Street Motors will be taking a deep breath” as Amazon is about to “accelerate into the world of car sales”.
Background to the new retail arm
The online retailing giant has already tested the waters in this sector with an online car dealership in the US. It also tied up an ongoing deal with Fiat in Italy, marketing the car firm’s 500, 500L and Panda models for a fee, and then supplying them through traditional car dealerships.
German automobile trade periodical Automobilwoche has reported that Amazon is setting up an HQ in Luxembourg, as a base to make more substantial inroads into European car retailing.
On the back of this, Amazon has been recruiting executive retail staff in the UK, which is the clearest evidence yet that the UK will be the testbed of the new online dealership model.
Will the new car retailing model work?
If the new online dealership follows its US scheme, Amazon will base much of its retail USPs on the availability of extensive research material and customer reviews to help inform the buying process.
This venture will sit alongside Amazon’s recent excursion into offering financial services – the technology giant began by offering loans to its marketplace traders. There is a strong body of opinion that this was the starting point of offering car loans (and other financing deals) to customers, potentially with Amazon Prime members having access to lower rates.
The move into car retailing is also part of a robust diversifying from its core operating principles and products. As reported on this site, Amazon recently purchased the Whole Foods store chain, meaning it now operates at least 400 physical shops in the US and Europe.
Will there be fertile ground for Amazon’s new retail executives to take on traditional auto dealerships?
According to a report from the NFDA’s Trusted Dealer scheme, a growing number of British people are willing to consider buying a car online. Within that research, those surveyed also felt that backing from an established franchise would make the online purchase more reassuring.
This move could well put car retailers in the UK under pressure to speed up their own use of technology in selling cars, which means that retail executive recruitment in the IT field, including data analysis and data protection, is even more pressing.
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