Motor Alley Completing Car Deals Entirely Online

ONLINE RETAIL REPORT - Friday, February 11, 2005 - By Joseph Checkler

Instead of simply finding customer leads for car dealers, Motor Alley LLC is helping dealers actually sell the car, from research to loan approval to delivery.

This does not mark the first time an online auto site has automated the entire car buying process - CarsDirect.com Inc. has offered a similar service since the late 1990s by buying cars from dealers on customers' behalf - but never before has the process involved direct, Web-based communication between a dealer and a consumer over one common computer system.

"CarsDirect has done very well as a middle man," said David Wassmann, chief executive of Bloomfield Hills, Mich.-based Motor Alley. "But everyone tries to keep squeezing out the dealer. The smart move is just to enable the dealer because dealers want to sell the car. The tools they have at their disposal are terrible. We're trying to put some tools in their hands."

Most online auto sites provide leads for dealers, but the customer must go in person to complete at least some parts of the deal. But using a Web-based management system from NeoSynergy LLC, car shoppers can find a local dealer through motoralley.com and communicate with them over the Web, completing the entire car-buying process, including price haggling. The dealer sets a lowest possible price that they want to sell a car for, and sends an instant "yes" or "no" response after the customer makes an offer. If the offer is too low, the dealer's message offers the customer a price somewhere in the middle.

The system should be up and running some time next week, Motor Alley said. Auto loans are also possible through the system, as NeoSynergy has signed on with creditors and even Routeone, the Web-based credit application system designed by General Motors Acceptance Corp., DaimlerChrysler Services, Ford Motor Credit Co. and others.