Economics
Online Car-Buying Startups Emerge as Dealer Aids, Not Disrupters
- New startups work with dealers rather than try to disrupt them
- Mobile apps for car financing leave dealers’ profits untouched
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The auto dealer -- around for more than a century and viewed almost as negatively as members of Congress -- looked like a ripe target for disruption when retailing moved online. Now that startups have tried and failed to beat the car salesman, many are taking a different route: catering to them.
After watching predecessors like TrueCar Inc. and Ford Motor Co. stumble in their attempts to bring more Amazon-like e-commerce to car shopping, a new wave of auto finance upstarts has emerged. Rather than fight a dispersed and politically-connected dealer industry, they’re bringing the country’s 17,000 new-car dealers into the digital age, meaning consumers aren’t going to be bypassing the dealership to buy new rides anytime soon.