Can anyone explain all these new online car things to me?

Bachelorplace

Can anyone explain all these new online car things to me and why we need them?
I get the Car Woo one, but the others like WIZZYBING and CAZOWWEE confuse me.
I like the notion that buying a used car on the internet allows you to have a long 7 day test drive. But boy is that embarrassing if you hate it and want to give it back. Can you imagine the phone call and how that would go? Oh heavens. 
Do people no longer care about cars anymore? Surely I am missing the point. Because I read one of these has raised £80m in venture capital. I assume that means people with money believe that people will buy cars like they buy stuff on Amazon? Is there some stats or is this a gamble? 
Don't get me wrong - the dealer networks particularly ( ah forget it no names ) can be extraordinarily painful and shockingly bad, so anything that avoids having to deal with them is maybe a bonus... is that it do you think, is that the model? People hate the dreadfully old fashioned dealer networks ( not all ) and will do anything to avoid them? Is that the bet, that these new websites are hoping for? If so what happens if the dealers fight back and get all modern?
Over to you. I am sure there is something I am missing here. 

AdrianC

Bachelorplace said:

Can anyone explain all these new online car things to me and why we need them?

We don't need them.

But people choose to use them because...
1. They don't like normal dealers.
2. They do like buying online.
3. Price.

Herzlos

People haven't cared about cars for a long time - it's just a box to get from A to B. Why shouldn't it be the same as buying a new washing machine?
Particularly post-Covid, many people will opt for avoiding the face-to-face and the journey, some will also be taken in by the free return within x days thing (which normally requires you to have done no more than 50 miles and stop using the car as soon as possible. I suspect that they delay submitting the keepers details or something for a week rather than taking the hit).

If there's demand, they'll do well, if there isn't, they'll flop.

Personally, I'd be all for it. The last time I bought a car from a dealership I had to wait about for the manager to come down and thank me for buying from them. What an awkward waste of time.

Supersonos

Bachelorplace said:

Can anyone explain all these new online car things to me and why we need them?
I get the Car Woo one, but the others like WIZZYBING and CAZOWWEE confuse me.

What's Car Woo?  Do you mean Car Wow?

tacpot12

The comment about people no longer caring about cars is true. For my parent's generation, the ability to travel long distances independently of public transport was a fantastic thing. A car was something to be marvelled over, and given their relative expense and unreliability, something to be cosseted and cared for. There was a romance to the speed of the car.

Nowadays, a car is, for most people, just a means of transport. Its speed is a convenience and nothing more. Our relationship with the car is changing, and will continue to change as automation takes over.

I'm a petrolhead, but I would be happy to swap a short test drive, for an extended test drive where you can find all the faults that the car has. The downsides is having to argue over any damage that occurs while you have the car in your care/ownership, and the delay in receiving your money back. I think the consumer regulations would give you a 14 day return period on a car purchased online anyway, so offering this as part of the service is just turning a negative into a positive.  

mgfvvc

I can't comment generally, but my latest car purchase, just last week, was less than £2000, so I felt reasonably happy taking a bit of a punt, based on an Autotrader ad and talking through the car history with the dealer. I transferred a £250 deposit and he delivered the car. We agreed beforehand that I would have a short test drive to confirm that there were no major issues before finalising the sale. It seems to have turned out OK this time, but I wouldn't want to make a habit of it.

Sandtree

Bachelorplace said:

Surely I am missing the point. Because I read one of these has raised £80m in venture capital. I assume that means people with money believe that people will buy cars like they buy stuff on Amazon? Is there some stats or is this a gamble? 
Don't get me wrong - the dealer networks particularly ( ah forget it no names ) can be extraordinarily painful and shockingly bad, so anything that avoids having to deal with them is maybe a bonus... is that it do you think, is that the model? People hate the dreadfully old fashioned dealer networks ( not all ) and will do anything to avoid them? Is that the bet, that these new websites are hoping for? If so what happens if the dealers fight back and get all modern?

Investment by a VC or PE means one of two things, either its a long term investment and they think the company will become highly profitable or its a short-mid term investment with a view that the share price will increase enabling them to exit their investment with a profit. Share price is based more on anticipated future value than past performance hence why the likes of Uber that are making large losses have massive market capitalisation values.

As to what is the future of car buying? No one has a crystal ball which is why investments are speculative and can result in losses if you back the wrong horse. Some are going to be market places and so basically sell leads and control the mechanism of communication but dont own or sell cars themselves, some will simply be an online dealer with the same challenges as traditional dealers... I suspect most are not going to be in the later category.

These things are fairly interesting though... if you look at WeWork, they classify themselves as a tech startup as they’ve created a subscription model and mechanism to book flexible working spaces however if you peal away the app they are a real estate company buying properties or leases and subletting on a short term basis. Valued as a tech startup their price looks fair, valued as a real estate company their value is crazy and many times higher than their longer established competitors.

Bachelorplace

"Investment by a VC or PE means one of two things, either its a long term investment and they think the company will become highly profitable or its a short-mid term investment with a view that the share price will increase enabling them to exit their investment with a profit. Share price is based more on anticipated future value than past performance hence why the likes of Uber that are making large losses have massive market capitalisation values."  AH HA! Like it. 

"Personally, I'd be all for it. The last time I bought a car from a dealership I had to wait about for the manager to come down and thank me for buying from them. What an awkward waste of time" hahahahahaha LOL brilliant - so cheesy - so very very very cheesy. "Can you just wait please here, yes our boss wants to deliver his line to you" 

The other good one is building relations with a person you like who has sold you nicely - then him grabbing his "finance expert" who then tries to sell you financial products because "its very sensible". I nearly walked from one deal due one trying to sell me a PCP over cash - saying I should leverage my money better - I asked him if he was a financial advisor and said I was about to leave. He got very defensive. Why should I have to live with that anxiety Jeez! 
Anyway I digress - sure the 2k punt is fair enough occasionally - and you are protected under distance selling and same rights as dealers - but the used cars from these online Start Ups are more like 15-50k. 

Maybe people don't care - about normal cars like say Golfs, T ROC, C Class and Focus and that is the hook - but not being able to sit in one and touch things seems daft - but yes - maybe people don't buy enough or care enough and if the online service is better its a win win for everyone. 

Sandtree

Bachelorplace said:

Maybe people don't care - about normal cars like say Golfs, T ROC, C Class and Focus and that is the hook - but not being able to sit in one and touch things seems daft - but yes - maybe people don't buy enough or care enough and if the online service is better its a win win for everyone. 

Its a big assumption that people don’t go into a dealership or similar first to do the “touching” and then go online to make the purchase... its the same in TV shops people go in look at the TVs, choose the one they want and then get their smart phone out and start looking at prices online.

Over a long enough timeline you’d expect these options to possibly die off if everyone buys online but for now we still have Waterstones on the high street and people have said for over a decade now that Amazon would kill them off.  I suspect there will be more inertia to people moving online for cars given the size of the investment (unless leasing/subscription models make more inroads) plus in some cases its dealerships selling via online  (my purchase from CarWow was a main franchise VW dealer) and so the revenue is still flowing for them. 

Grumpy_chap

Online car buying seems entirely alien to me, especially for a used car where you need to be able to inspect and test-drive the car to assess a good one from a bad one.  Far too many threads on here from people who purchased a used car "unseen" then found issues and unable to get resolved because those issues could have been identified by an average person taking due car and diligence.

Even the reputable companies offering a "quibble-free" mileage / period for swapping out of the deal - that can never be as good as the marketing as by the time this is needed, they've got rid of your part-ex so full reversal is impossible and you have to then buy something and are at their mercy.  Even if you ignore the insurance, VED, etc costs that you have incurred.

For any car, there is also the fact that the purchase is not simply a decision of the head, but the heart is having a big influence, so it is all about the "touchy-feely" stuff, plus the ergonomics of how you sit in the car.  Impossible to get the full "scratch-n-sniff" over the web.

However, car dealers (including new) do so often offer such appalling service, I understand why there is scope for another route that avoids them.  Really, for most people, updating the car is a "want" rather than a "need" and it is the second-biggest purchase people are going to make so why aren't you treated like royalty when entering the showroom?  On more than one occasion I have visited a dealer to buy a car, looking to do the deal, and ended up walking out empty handed and keeping the old car because it is just less hassle.

Herzlos

A dealership can hang onto a p/x for the week you've got to change your mind, or they can just offer you an alternative instead of unwinding the entire transaction (so you buy a £15k car with a trade in, don't like it, you'd get to pick something else for £15kish).