GM & Ebay generate interest but little sales

DETROIT -- General Motors effort to sell new cars on eBay in California is generating interest but recording few sales on the Internet auction site.
In the first nine days of the program, GM dealers listed 16,228 vehicles on eBay and completed 45 sales, according to data available on the Web site.
But GM said the eBay exposure is prompting customers to visit dealerships to complete sales that aren't recorded on eBay.
"It's way too early in the program to have any concrete understanding of what's going on," said John McDonald, GM spokesman.
Mark Borjan, a Buick-Pontiac-GMC dealer, said he listed 70 vehicles on eBay and sold seven, but only one is recorded with eBay.
"I've sold some vehicles to people that saw the vehicles on eBay, but they didn't buy them on eBay. They called, came in and bought them," said Borjan, owner of Golden Hills Auto Center in Paso Robles, Calif. He sells about 300 new vehicles annually. Said McDonald: "eBay is generating leads. A big part of this is about generating awareness of GM products in the California market."
eBay said the GM eBay Web site had 630,000 visits in the first week and logged more than 960,000 searches of listed vehicles.
California is a tough market for GM. The automaker's market share is about 13 percent, according to McDonald. GM's national share through seven months this year was 19.6 percent.
Also, California's economy has been hit hard by the recession. According to R.L. Polk, new-vehicles sales in California are down 41 percent through June.
Edmunds.com also crunched the numbers from GM's first week of eBay sales and found that the "Buy It Now" price listed with each vehicle was, in many cases, higher than the average market price.
"The World Wide Web is indeed a web, and marketers need to connect all touch points a consumer is likely to check," said Edmunds.com CEO Jeremy Anwyl in a statement. "In this particular case, GM offered a price that is above market price, and that could create friction for those trying to close a sale."
Edmunds said "Buy It Now" prices averaged 2 percent higher than what the vehicles are actually selling for. Automotive News analyzed 16,228 completed auctions and found that no eBay shopper used the "Buy It Now" option.
According to Edmunds, the number of buyers researching GM's prices on eBay jumped 10 percent higher in California than it did in other states during the first week of the program. Edmunds believes that the eBay program mostly attracted buyers who were already interested in GM vehicles.
Edmunds also took a look at the vehicles California shoppers using the GM eBay site researched most. The top vehicle researched might cause GM marketers some heartburn. It's the Pontiac G8, which has already been dropped.
The Chevrolet, Pontiac, Buick and GMC vehicles are not being offered in eBay's traditional auction format. Instead, vehicles are listed at the manufacturer's suggested retail price, along with any incentives offered. A consumer can either buy the vehicle immediately at that price - which no one did - or submit an offer below the listed price. It's up to the dealer to accept or reject the offer.
GM said 225 dealerships are participating in the eBay pilot program, which started Aug. 11 and runs through Sept. 8.

SOURCE: [ Automotive News ]