Walmart Getting Into The Car Business?

Josh Meador

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It seems the nation’s largest retailer, selling almost everything you would ever need from groceries to clothes, electronics, home improvement, as well as pharmaceutical and hygiene products isn’t stopping its expansion. It is now diving into the car business.
Walmart won’t directly sell the cars or partner directly with dealers. Walmart is getting into the business partnering with a company called CarSaver. Walmart will lease spaces in certain stores for CarSaver to place kiosks, much the way they do with Subway, McDonald’s, vision centers, and Cost Cutters. These kiosks, will have a website that allows customers to shop for, finance, and insure new and used automobiles through dealership groups as well as lenders, including AutoNation and Ally Financial. They will also allow customers that shop on CarSaver’s website the opportunity to make an appointment with a nearby dealership. CarSaver then earns $350 if an appointment leads to a sale.
CarSaver’s CEO Sean Wolfington said Walmart’s car selling program is based directly off of Costco’s. He also stated, more than two decades ago he managed the Costco program for a dealership he worked at. Following this Wolfington said, I was impressed with Costco’s program and how much easier it was for the dealership because consumers trusted Costco and appreciated the haggle free pricing and hassle free experience. Also saying he was convinced that this was the right way to sell cars, with a fair, transparent price presented by brands the customer trusts most. We all know how annoying and hassling car salespeople can be and this program may just put an end to that hassle.
Walmart is chasing Costco who since its start on September 15, 1983, has become one of top car selling companies. Costco, through partnerships with companies such as Affinity Auto Group and car dealerships, sold nearly 400,000 vehicles last year. That’s almost twice as many as they sold in 2008, coming close to number one AutoNation who sold 533,000 cars.
So far, a pilot program has been started with a kiosk inside one Walmart Supercenter. The pilot program has been going on for about one year and over half of the dealership appointments that were made turned into sales. Walmart spokeswoman Molly Blakeman said, “The program is still in test mode. It is not uncommon for us to test different customer offerings in our stores using our leased spaces. We currently have a one-store pilot underway with CarSaver in Stuart, Florida, and are still evaluating customer response.” CarSaver and AutoNation confirmed in late January that it will open 25 kiosks throughout Walmart stores in Dallas, Houston, Phoenix, and Oklahoma City on April 1st.
CarSaver’s goal is to sell at least 1,000 cars per year at each Walmart. Therefore, if the program becomes a success and expands to around 500 or more Walmart stores, it has the potential to knock Costco out of the car sales arena. Just think, the next time you go to Walmart for groceries you may end up buying a new vehicle.

 

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Walmart Getting Into The Car Business?