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Carmakers promote online car sales in China to offset customers staying away from showrooms

2020-03-20 11:42 Friday

In a bid to boost sales among shoppers who are currently reluctant to venture out in public, prominent Chinese carmaker Geely has launched a new service to enable customers to buy automobiles online and have them delivered directly to their door.

The move comes as the recent coronavirus outbreak has deterred many from visiting physical showrooms. The Zhejiang-based automaker is the just latest brand to launch a new online service. It joins the ranks of Tesla, BMW and Mercedes-Benz who are also now actively marketing cars through their own apps and websites.


The move is likely to affect Chinese auto finance and leasing firms, which have also ramped up their efforts to market their products online and using social media platforms such as WeChat and Weibo in recent weeks.

To reach more digital-savvy consumers, Geely has already partnered with a host of 3rd-party online sales platforms such as JD.com, Tmall, and Suning.com in the past, but the current development is the first time the company is selling its own cars through its own website.

The trend coincides with a downturn in car sales in the country, which fell again in the first half of last month. Geely is the owner of Volvo and black cab maker The London Electric Vehicle Company. It said customers can now order and customize their vehicles on its website.

A senior official at Geely, Victor Yang, told reporters that encouraging online sales will allow carmakers to reach customers directly through their own marketing channels and help them develop this area should they wish to continue to do so going forward.

Geely said that car production last month was only around 30 percent of its usual output, but the majority of remaining workers will return to work in the next few weeks. Yang added that the carmaker has bought facemasks for all its dealers and factory workers.

To compliment the online sales offering, China's biggest privately-owned car maker will also provide test drives for potential customers without them needing to visit a showroom, since the car can be dropped off directly at their personal address. Geely has called the service a fully "contactless" vehicle buying solution.

Recently, Mercedes-Benz also commented that it was working more closely in step with Chinese dealer partners to support online sales channels. A representative for the German car maker remarked: "In face of the current situation, we've extended our online offer and have observed a positive response from our customers."

Last year, it is estimated that almost 825,000 new vehicles were sold online around the world, according to figures from consultants Frost & Sullivan. These sales were achieved either through online auto financing, auto leasing arrangements or by making part payments online.

The firm estimates that by 2025, 6m vehicles will be sold through similar online platforms and said "the COVID-19 will provide impetus to digital retailing for cars".

Sarwant Singh, managing partner at Frost & Sullivan, commented: "As witnessed in China, the postponement of purchase decision is encouraging vehicle manufacturers to redirect resources towards online marketing and e-commerce platforms. China is the world's largest car market, selling more than 21m vehicles last year.

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