Cliff Banks - The Banks Report

AutoNation Launches Next Step in Online Buying

December 5, 2015 — After launching AutoNation Express a year ago the nation’s dealer group is taking the next step adding the ability for customers to secure an online appraisal for a trade along with determining financing.

The new components launched earlier this month according to a report in the Sun Sentinel. The initial program has generated several thousand reservations for AutoNation with more than 50% of those reservations turning into sales.

AutoNation has invested more than $100 million over ten years to develop the new program which provides customers the ability to conduct the entire car buying transaction online.

The industry has a ways to go before it catches up to AutoNation. Other dealer groups such as Sonic Automotive and the Larry Miller Automotive Group are embarking on similar initiatives but are still in the development phase.

Meanwhile, Dealer Success launched Virtual Deal earlier this year which helps dealers provide a much deeper online buying experience for their customers. Cox Automotive brought MakeMyDeal to the market last year.

Due in part to AutoNation’s initial success, the industry will likely see a much faster adoption rate of solutions that drive online buying capabilities for consumers.

AutoNation also announced last week that its November sales declined 6% with same store sales falling 7%. The report may not be as troubling as it sounds, though. November had two less selling days than last November, and even though the industry reported a sales increase for November, retail sales actually dropped 2% according to AutoData.

AutoNation also is the nation’s biggest Ford retailer and likely was affected by Ford’s failed “Friends and Neigbors” program that it shut down after a few weeks. It was also hurt by the fact Mercedes Benz’s sales numbers dropped 11% in November. AutoNation operates 26 Mercedes dealerships.

AutoNation is the only dealer group to report monthly sales numbers.

The group also is acquiring Renton Honda in Renton, WA from Lanphere Enterprises. It will be AutoNation’s 35th dealership acquisition this year compared with five last year. The purchases should bring in an estimated $1.7 billion in revenue next year and could push AutoNation into the $22 billion to $23 billion range.

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