So, as reported in Auto Retail Network and lots of other places, Amazon are planning to enter the car market using the UK as a guinea pig (or, perhaps, proof of concept). Maybe the time is ripe with the country set to distance itself from the system of competition law that allows vehicle manufacturers and importers to restrict supplies to authorised dealers. The block exemption has not been popular in the UK, initially because it enabled suppliers to charge higher prices here than on the continent (something tells me that the sort of mindset that caused car buyers to head off to Belgium or The Netherlands back in the eighties might well have led them to vote leave in 2016 - but it's no more than a feeling). Maybe Brexit will be an opportunity to shake up what is seen by many as an unjustifiably privileged sector, insulated from normal competitive pressures.
Amazon have tried in a small way to sell cars before (Fiats in Italy: how could that go wrong?). Tesco have tried online car sales for a short time, and there have been other attempts to use ecommerce to cut out the middleman. Further back in history, there was Asdadrive, which emerged in the mid-eighties and made scarcely a ripple - and has disappeared so comprehensively that there's almost nothing to be found on the Internet save for some Companies House records.
It is trite to remark that selling cars is not like selling baked beans. You don't trade in your previous beans when you buy a new can, for a start. There is no continuing servicing and repair requirement, no market for spare parts, no way of adding accessories, no opportunity to sell financial services ("products", as they are weirdly called) as well. (Or, to put it another way, these days the cars are often ancillary to the financial services). For these reasons selective distribution remains the optimal way to service a complicated market, although those complications change over time as service intervals become longer, cars become more reliable, and the chances of effecting an economic repair when a prang occurs tend towards zero. (The bumper is supposed to save the car from damage, but the sensors now mounted in it make replacement prohibitively expensive.) So Amazon might find that they have bitten off more than they can chew, though with sales and service being separated by the block exemption the landscape is different from that which faced Asdadrive. Maybe, as Brexit approaches, this will be seen as an excuse to dispense with the block exemption - a move that could be dressed up as consumer benefit, potentially a popularist aspect of leaving the EU. And another chicken that would come home to roost a few years later, I suspect.
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Amazon have tried in a small way to sell cars before (Fiats in Italy: how could that go wrong?). Tesco have tried online car sales for a short time, and there have been other attempts to use ecommerce to cut out the middleman. Further back in history, there was Asdadrive, which emerged in the mid-eighties and made scarcely a ripple - and has disappeared so comprehensively that there's almost nothing to be found on the Internet save for some Companies House records.
It is trite to remark that selling cars is not like selling baked beans. You don't trade in your previous beans when you buy a new can, for a start. There is no continuing servicing and repair requirement, no market for spare parts, no way of adding accessories, no opportunity to sell financial services ("products", as they are weirdly called) as well. (Or, to put it another way, these days the cars are often ancillary to the financial services). For these reasons selective distribution remains the optimal way to service a complicated market, although those complications change over time as service intervals become longer, cars become more reliable, and the chances of effecting an economic repair when a prang occurs tend towards zero. (The bumper is supposed to save the car from damage, but the sensors now mounted in it make replacement prohibitively expensive.) So Amazon might find that they have bitten off more than they can chew, though with sales and service being separated by the block exemption the landscape is different from that which faced Asdadrive. Maybe, as Brexit approaches, this will be seen as an excuse to dispense with the block exemption - a move that could be dressed up as consumer benefit, potentially a popularist aspect of leaving the EU. And another chicken that would come home to roost a few years later, I suspect.
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