Default Screen Resolution Wide Screen Resolution Navigation:    Home arrow Atlanta Auction Access INCarrow Online Car Market Revs Up

Online Car Market Revs Up
E-mail
Written by Robert G. Jackson   
Friday, 13 February 2009
HOPING TO MOTOR into the burgeoning automotive e commerce market, a former distribution manager from Ford Motor Co. and two information technology firms last week unveiled a plan to create an online market for used vehicles and car dealers' supplies.

The online network at the Web site e401.com, called the Retail Auto Exchange, will focus on auctioning and selling previously leased and used vehicles from institutional sellers such as rental car agencies and finance companies. It will also offer auto dealers online procurement of parts, office supplies and equipment, as well as financing and customer relationship management services.

E commerce software maker TradeX Technologies Inc. in Atlanta is involved in the deal. A subsidiary of Ariba Inc., TradeX has struck similar deals to develop trading networks with J. D. Edwards & Co. in Denver and American Express Co. in New York. The other firm, Needham, Mass. based NerveWire Inc., is an IT services company.

Online trading networks typically charge users fees ranging from 1% to 15% of the transaction amount, plus membership and services fees.

John Burkey, the former Ford distribution manager who is now president of e401.com, said the participating dealers will pay a small commission on transactions but can expect savings of $300 to $500 per vehicle and 5% to 10% on commodities such as parts and office supplies. The Web site is a business unit of Philadelphia holding company LexbancAG Inc. The site should begin trading by the end of March, Burkey said. It will charge no registration or membership fees and will offer dealers free Internet access, e mail and hosting services for dealer Web pages. More than 160 dealers have registered, he added, but he didn't name them.

A flood of online procurement, vehicle and parts exchanges has hit the automotive industry in recent months, including General Motors Corp.'s TradeXchange supplier network and Ford's AutoXchange online procurement system.

Analyst Daniel Garretson at Forrester Research Inc. in Boston said he expects to see more this year. "There is still a very open market for creating these exchanges, because these exchanges add a lot of value in most industries, if not all, by creating more efficiency," he said.
Last Updated ( Friday, 13 February 2009 )