Consumers Still Want to Do Before They Buy -Duh

September 27, 2002 DETROIT The AP reported that most Americans still want to kick the tires and take a test drive before buying a new vehicle -- instead of purchasing online -- but dealers say the Internet has become an important educational tool, a new survey of automotive buying habits shows.

Nearly three-quarters of U.S. consumers bought their last vehicle from a franchised dealer, while 14 percent chose a used car store, according to the survey released Thursday by the Paris-based consulting firm Cap Gemini Ernst & Young.

Internet dealers, such as Autobytel.com, were responsible for only 1 percent of car sales among those surveyed.

"The consumer still wants to go to the dealership and test drive that car before he buys it," said Michael Wujciak, vice president of the global automotive sector at Cap Gemini Ernst & Young.

The survey included 2,500 consumers, 80 automakers and suppliers and 800 dealers in eight markets -- the United Kingdom, France, Germany, Benelux, Italy, Sweden, the United States and Japan.

Auto dealers in the United States were among the least concerned about the potential impact on their business from new sales channels such as the Internet.

The new findings were in line with a study released last year by Consumer Reports that found that only a third of those attempting to buy a vehicle online actually complete the deal.

Consumer Reports said the majority of those who declined to buy a vehicle using an online service either preferred face-to-face negotiations or did not believe they were getting the best price.

Herb Adcox, a Chevrolet dealer in Chattanooga, Tenn., said he increasingly deals with customers who have used his and other Web sites for information on models and options before visiting the showroom.

He said most still feel more comfortable sitting in a car and taking it for a spin instead of choosing one on a computer.

"And if you have a trade-in or need help with financing, those are things you just can't do without being in the dealership," Adcox said.

Wujciak said he wasn't surprised by the small percentage of people buying cars online, but he did expect to see higher numbers of shoppers using the Internet as a source for information.

In all eight markets, less than 20 percent of those surveyed claimed the Internet as a source of research. Eight out of 10 said they relied on visits to traditional dealers as their main source of information.

Wujciak said one area where automakers and dealers can improve is the information they provide on their Web sites.

Specifics that consumers said they'd like to see but often can't find are the price of a vehicle, where they can buy parts for a certain model and a delivery date if they've made an order.

"If you can accelerate the functionality of the site, you at least have a bit of a competitive advantage with some buyers," Wujciak said.

Overall, customer satisfaction with franchised dealers was high -- 87 percent. Used car dealers came in slightly lower at 81 percent.

"I've been in the business for 50 years, and most dealers know that customer satisfaction is the key to staying around," Adcox said.