Illustration for article titled Dealerships Online Shopping Platforms Are Increasing Convenience But Might Be Decreasing Savings
Photo: AP

Because of Covid-19, several dealers have begun to utilize online buying platforms that allow customers to get prices and even initiate a transaction without ever talking with a salesperson. These apps make the shopping process a bit easier, but that convenience might come at a cost in the form of a competitive deal for the consumer.

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If you are currently shopping for a car you may come across a dealership using something like an “express buy” purchase on their website. Basically how this works is a third party application allows the dealer to pre-program pricing on their models for cash, finance, or lease transactions.

The customer can set the down payment, location for tax, mileage for their lease and the system calculates payments accordingly. This takes a lot of time out of traditional car shopping, but these applications have a few pitfalls.

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The first one is that you may not actually be able to avoid communicating with a salesperson. Some dealers build in an “unlock” code that requires you to input your name, phone number and email to get a code to see the pricing. Naturally, as soon as this information is sent you can expect a number of phone calls and emails asking you “When you can come in and check out the car.”

The second downside is that while dealers can set the prices on these platforms; the store can choose how competitive, or not, they want to present their offer. Here is a quote using the online buying platform from a Mazda dealership in the Philadelphia metro region on a brand new CX-5 Touring.

Illustration for article titled Dealerships Online Shopping Platforms Are Increasing Convenience But Might Be Decreasing Savings

Notice the dealer discount of only $965 before rebates

Here is another quote from a competing store that sent a more “traditional” deal sheet.

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Illustration for article titled Dealerships Online Shopping Platforms Are Increasing Convenience But Might Be Decreasing Savings

They offered a dealer discount of $2,000 before rebates.

The third issue with the pricing on these platforms is that your quote is behind a URL and that can be changed at any time. I was shopping for a Toyota 4Runner for a customer in California and the dealer sent me a link to their breakdown and it offered a discount of around 9 percent off the MSRP. A few days later I clicked that link and the discount changed to only $500 off the sticker price. I would recommend any shopper that encounters these platforms to screenshot the offers they see, in case things change later.

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The key thing to remember here is that one of the main pitches these platforms use to sell their service to the dealers is that these apps will increase profitability. Dealers don’t typically spend money on things unless they think it will help them make more money. From a business perspective that is totally understandable, but when consumers are using these platforms they may find a better deal elsewhere.

It was predicted that the coronavirus pandemic would “change car buying forever.” While some stores had to make major adjustments to how they sold cars, it seems that for the most part the dealership experience back to the way it was. If a shopper wants the best deal, they have to work for it.

Tom is a contributing writer for Jalopnik and runs AutomatchConsulting.com. He saves people money and takes the hassle out of buying or leasing a car. (Facebook.com/AutomatchConsulting)

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