Car-Buying After Lockdown: New Business Models Emerge
Buyers are now more comfortable conducting entire car-buying transactions online due to the coronavirus pandemic.
Unlock 1.0 is here and with consumers slowly emerging from their homes, it's time to decide on a mode of transport. Keeping in mind social-distancing norms and the fact that the coronavirus pandemic is still rampant, research shows that many consumers are looking to buy a car instead of using a cab or taking public transport.
However, even the car buying experience isn't going to be the same. Consumers are wary about visiting multiple car showrooms and taking test drives of cars, keeping in mind sanitation concerns. While car showrooms are assuring consumers of complete hygiene practices, there are new business opportunities that are emerging for some companies, who are facilitating an end-to-end online buying experience for car buyers.
Here's how buying a car is likely to be different after the lockdown.
AckoDrive is a company that is associated with Acko Insurance. However, it has recognised a need for consumers - to move the entire buying experience online. What it has lined up is a choice of cars of all brands online, giving customers a guaranteed delivery date, door-step delivery and offering lower prices than even direct negotiations with dealers, without needing to visit a car dealer even once.
How does this model work? The company negotiates with multiple dealers and blocks a set of inventory for sale. It publishes this inventory on its site, mainly from popular models, allowing customers to directly book them and pay online. All the paperwork is done online, with door step delivery of the vehicle.
“We only look at popular models that the customer is familiar with. This reduces the need for a test drive at the dealer premises, and we give quick delivery dates as we already have the inventory, directly delivering the car to a customer’s doorstep.”Sagar Das, Head of Business, AckoDrive
For dealers this works as a sort of reassurance, because they know that a certain number of cars will get paid for any which way, since AckoDrive blocks that inventory. For the consumer, the benefit of a further discount (culled from insurance offers from Acko insurance and cash discounts) makes it a sweeter deal.
But what if you wanted to take a test drive of a car? Sometimes a particular model isn't available with a dealer. That's where MyNewCar has a differentiated model to offer.
The company has a platform called Trivz, which is a peer-to-peer test drive platform that allows users to get access to cars they specifically want to test drive. For example, if a user wants to test drive the base-model Hyundai Creta EX variant, but a showroom does not have it, the Trivz platform will find a customer who has the car and is willing to share his experience of it with the potential buyer.
MyNewCar also facilitates a full online buying experience. However, it doesn't block inventory with dealers, but instead directly connects customers and the dealer for a particular car.
“There is a distinct change in the mindset. We have seen that the footfalls at dealerships have drastically reduced and customers are now more open to an entirely online transaction.”Madhukar Manpuria, Founder & CEO, MyNewCar.in
He adds, "We have also seen that people are more open to different ways to buy cars since cash flow is an issue. They are looking at leasing and subscriptions as well now, as there is uncertainty. In fact, we are now getting many more queries for retail leasing, for even hatchbacks."
These business models ensure that the car-buying experience also moves online. If a customer wants a test-drive, a particular slot is booked and a sanitized test-drive vehicle is brought to the customer's doorstep. Or using Trivz, a peer-to-peer test drive can be arranged.
So while dealership footfalls are likely to be lower a lot of the car-buying and bike-buying transactions are likely to shift online in earnest because of the pandemic, especially for popular "tried-and-tested" models.
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