Priceline.com's New Car Sales
21 September 1998
After First 45 Days, Priceline.com's New Car Sales Pass $2 Million Mark In New York Market Test
STAMFORD, Conn.--Sept. 21, 1998--"Name-your-own-payment" plan option for loans and leases coming
soon
Test market results bode well for large national business
New York metro-area consumers searching for the easiest way to buy a new car are discovering that priceline.com is right on the money. The patented e-commerce system, where consumers name their own price for airline tickets and new cars, is attracting thousands of car buyers and has sold more than $2 million worth of new cars just 45 days after launching in its first test market.
Priceline.com's new car buying service launched its first market test in the New York metro area in July. The service enables new car buyers to name the exact car or truck they want, the price they want to pay and the counties they are willing to travel to in order to take delivery of their new car. Currently, all customers must either have their own financing or pay cash for their new cars - a limit in the priceline.com market test that will be removed later this year.
There is no charge to make an offer for a new car. Priceline.com takes the buyer's request, removes the name to protect the buyer's privacy, then faxes the offer to all factory authorized dealers in the specified counties. The first dealership who has the exact car and is willing to sell at the buyer's price gets the sale. Once the sale is completed, priceline.com collects a $25 fee from the buyer, and $75 from the seller.
Later this year, priceline.com will add financing options that enable consumers to name their own monthly payment plan for their new cars. The new car service will also expand from the New York metro area to national availability on a market-by-market basis.
"We're extremely pleased with consumer response to our new car service, particularly since the service is essentially cash-sales only (which are less than 5% of all new car sales) and is available in only one market (which represents approximately 8% of all new car sales)," said Jay Walker, founder and vice chairman of priceline.com. "Combined, these two factors mean that priceline.com is currently serving only a sliver of the broader, nationwide new car market. However, if you project today's New York-only sales onto a nationwide scale, it would represent monthly sales of more than $100 million. Clearly, priceline.com is the easiest, most hassle-free way to buy a new car."
Priceline.com executives attributed the fast ramp-up in new car sales to the excitement and convenience of being able to name your own price for the exact car of your choice and never having to negotiate or haggle with a new car salesman.
Priceline.com, Inc., is a privately held company that has created the world's first buyer-driven e-commerce system. The company received U.S. Patent No. 5,794,207 for its e-commerce system in August. The priceline.com system was invented by Walker Digital, an intellectual property laboratory founded in 1996 by Jay Walker.
