Will GM & eBay Destroy Dealerships
As an example of how General Motors plans to be more adaptable, chief executive Frederick Henderson said that the just-out-of-bankruptcy company is in discussions with eBay, the online auctioneers, to begin an experiment to sell vehicles in California.
eBay has been listing cars for sale for the past 10 years on its website, eBay Motors. According to eBay, more than 30,000 franchise and independent dealers, including some GM dealers, have been listing used and certified pre-owned vehicles for sale. Last year, eBay reached 3 million vehicles sold since the website started. The Big Deal: GM may be trying to figure out how to sell NEW vehicles on the website.
State franchising laws currently prohibit the sale of new cars direct from the manufacturer through auction sites such as eBay. Dealers are held accountable to abiding to their state laws and regulations. eBay Motors provides the platform and serves as the marketplace. We do not hold any inventory or sell cars.
If GM does figure out how to get around the franchise laws, it could mean a major shift in car buying. It will fundamentally change the interface between dealers and people buying cars.
