Citroen to establish direct online car sales as it looks to mimic Tesla model

Citroen Ireland says online car buying is a ‘medium term project’

 

Car firm Citroen has announced a programme to start selling cars directly to customers online.

The traditional car dealer is looking more likely to be sidelined in the coming years, and follows Tesla’s efforts to establish direct-from-factory sales in the US and other car dealers and brands moving to smaller, city-centre and shopping-centre outlets, will allow buyers to specify and order a new Citroen online and pay a deposit for the car of their choice.

They can also choose from existing dealer stock across the network and nominate a dealer from whom to collect their new car. All of this can be done without leaving the house.

The plan is part of the new ‘Citroen Advanced Comfort’ project, announced earlier this year. Initially, that Advanced Comfort was related to mechanical and trim items, such as redesigned suspension systems to give Citroen models a more gentle ride quality and variable-density memory foam seats which are claimed to offer far superior support and comfort.

Advanced Comfort now extends to other areas, such as making cars easier and simpler to select and order. Not to mention less stressful. According to an Auto Trader market survey from February of this year, more than 80 per cent of surveyed buyers said that they found the traditional system of test drives and haggling stressful. Another 26 per cent said that they had backed out of a purchase because of unease with the process.

Fixed pricing online

So, Citroen in the UK is going to offer fixed pricing across its range for online customers, while the system will also offer estimated trade-in values for your existing car, subject to an inspection later on.

Speaking to Auto Express magazine, Citroen chief executive Linda Jackson said that “E-commerce is being rolled out in selected markets, and it will eventually get to the UK - hopefully next year. Not everybody wants to buy a car online but some do. You can look at the car, configure the car, get your finance, sort your deposit and then you go into the dealer to get your test drive. In that way, there is still a link to the dealer.

“The online sales have been designed to be very transparent for the customer - because when you’re selling online, your prices tend to be very obvious. It removes this concern that we get back from customers that they don’t want to negotiate on price. Not having to haggle is part of Citroen Advanced Comfort, absolutely.”

The fixed pricing issue could lead to the plan not being rolled out in Ireland, at least not yet. Back in the early 2000s, both Fiat and Opel attempted to do something similar with so-called ‘Open Book’ pricing, issuing prices that its dealers had to stick to. That fell foul of the competition authority though, which saw the move as clamping down on any potential discounts which individual dealers could offer, and saw offices raided and charges issued.

Irish sales

Citroen Ireland’s marketing director, Louise Murphy, told The Irish Times that “it is clear that online sales are coming at some stage in the future with Citroen in Ireland. It is a purchase channel that some customers will want to avail of. How this will be operated and managed, in partnership with our network of dealers and PSA, is yet to be determined. The roll out of e-commerce will happen in the UK first before it would be launched in Ireland, so it will be a medium term project.”

However, it is possible that most buyers aren’t quite ready to do all their car buying online just yet. According to a survey carried out in the US by software company Dealer Sockets, only one third of potential car buyers said that they would go from research to completed purchase fully online.

While half of buyers in higher earning brackets said that they would like to bypass the traditional dealership model, only 29 per cent of middle-income earners said that they would do so. Dealer Sockets commented that while many car makers and dealers are scrambling to catch up with the perceived need for online and even direct sales, there is “a false sense of urgency” about the need for such processes and that while there is a need for development of online buying systems, the old-fashioned dealer’s glass palace isn’t going away just yet.