Autoweb.com and CarsDirect.com Form Wide Ranging Alliance
27 March 2000
Autoweb.com and CarsDirect.com Form Wide Ranging Alliance
Precedent-Setting Agreement Between Industry Leaders Spans Buying Services,
Content, Branding and Joint Equity
LOS ANGELES, and SANTA CLARA, Calif., March 27 Autoweb.com, Inc. and CarsDirect.com, Inc., leaders in the
online referral buying and the online direct buying automotive categories,
announced today a wide ranging business alliance to capture a larger share of
online automotive sales and accelerate car buying through the Internet.
The agreement will include the launch of a co-branded direct buying
service on Autoweb.com, placement of exclusive links between the two
companies' sites, and licensing of data content and tools. In addition, the
companies will pursue ways to work together as infrastructure partners on
future product development. Autoweb.com and CarsDirect.com expect the alliance
to broaden the audience reach of both companies, enhance their consumer brands
and enable more people to buy cars online.
Under the agreement, Autoweb.com and CarsDirect.com will jointly develop a
direct new-car buying service on Autoweb.com. This will give Autoweb.com
consumers the ability to receive an upfront, fixed price and conduct the
entire automotive purchase process online.
Autoweb.com will become the only referral buying option for
CarsDirect.com. Additionally, CarsDirect.com customers will have the
opportunity to link to Autoweb.com to list their used car for sale. By meeting
online car shoppers' need for choice, the agreement is expected to give both
companies a competitive advantage in the rapidly growing Internet car
marketplace.
To underscore their commitment to the agreement, Autoweb.com and
CarsDirect.com are taking an equity position in each others' companies.
"By leveraging our complementary strengths, we are able to broaden our
consumer offerings more rapidly and cost effectively," said Dean DeBiase,
Autoweb.com's chairman and CEO. "Autoweb.com and CarsDirect.com are clearly
focused on helping more consumers find and buy their vehicles through the
Internet. We believe CarsDirect.com provides the best experience for car
buyers who wish to purchase a vehicle completely online, and together we will
offer the most comprehensive direct new car buying service to Autoweb.com
consumers."
"Autoweb.com is a leader in aggregating car buyers and has enormous
traffic," said Bob Brisco, CEO of CarsDirect.com. "By jointly building a
direct sales option for Autoweb.com users, we will be able to dramatically
expand the reach of the CarsDirect.com service. We are looking forward to an
ongoing, multifaceted relationship with Autoweb.com that will set a new
standard for our industry."
Fifty-five percent of Americans who buy a car this year will use the
Internet at some point in the process, according to J. D. Power and
Associates, and the figure is expected to grow to 80 percent by 2003. Online
Internet transactions are increasing at an even faster rate -- nearly
3 percent of new cars were sold through the Internet in 1999. A goal of the
new alliance will be to accelerate that growth trend.
"The referral buying process continues to be a very popular and growing
way for consumers to purchase vehicles through the Internet, and Autoweb.com
remains dedicated to working closely with its network of quality automotive
retailers to enhance that process," said DeBiase. "At the same time, there is
a growing segment of consumers who want to configure and purchase their
vehicle completely online. We believe we need an offering for that consumer
segment. Our new direct service is a natural next step in Autoweb's strategy
to continue expanding choice to satisfy the needs of online automotive
buyers."
Under the agreement, Autoweb.com dealers will be given the opportunity to
participate in Autoweb.com's new direct service by joining the CarsDirect.com
Priority Dealer Network. Similarly, dealers in the CarsDirect.com network will
be given the opportunity to participate in the referral buying program by
becoming Autoweb.com Quality Member Dealers.
Conference Call
Autoweb.com will hold a conference call today, March 27, at 2:00 p.m.
Pacific Time (please call in 10 minutes prior to the start of the call). To
participate in the call, please dial 630-395-0252. There will also be a replay
available until April 10 at 402-220-9761.
About Autoweb.com
Autoweb.com is the leading consumer automotive Internet service, guiding
consumers through every stage of vehicle ownership. From research and buying,
to enjoying, maintaining and selling, Autoweb.com delivers what consumers
want. Starting with comprehensive, unbiased automotive research, Autoweb.com
also provides many options to buy new and used vehicles through its auction,
direct-to-consumer and dealer referral commerce channels. Autoweb.com works
with more than 5,000 Member Dealers, vehicle manufacturers and other commerce
partners to provide the best experience at every stage of vehicle ownership.
For more information, please visit http://www.autoweb.com .
About CarsDirect.com
CarsDirect.com (http://www.carsdirect.com), the leading automotive e-tailer, is
the first nationwide online service that puts consumers in control of the
total car buying experience -- from research, pricing and customization to
financing and delivery. With CarsDirect.com, car buyers can see and compare
real, upfront prices on virtually every vehicle sold in the U.S, obtain a loan
or lease, place their orders directly online and arrange for home or office
delivery. More than 2,000 franchised dealers are a part of CarsDirect.com's
Priority Dealer Network.
Based in Los Angeles, CarsDirect.com is an idealab! company. The company
is also funded by idealab! Capital Partners, Primedia Ventures, Foundation
Capital, MSD Capital LP, Goldman Sachs, Morgan Stanley Dean Witter, Hambrecht
& Quist, E*O Investors, LLC, Oracle Corp., Liberty Digital, TMCT Ventures,
L.P, Hikari Tsushin and Soros Private Equity Partners LLC.
Statements in this news release, including statements that include words
such as "expects," "believes" or other future-oriented statements, contain
forward-looking statements that involve risks and uncertainties that could
cause actual results to differ from anticipated results. These risks and
uncertainties include unanticipated changes in competitive behavior, changes
or lack of changes in consumer preferences over time, technological challenges
and an inability to forecast future traffic and transactions. Further
information on risk factors that could affect the Company's results is
detailed in the Company's filings with the Securities and Exchange Commission,
including the Conmpany's Registration Statement on Form S-1 (No. 333-71177)
and the Company's Form 10-Q for the quarter ended September 30, 1999.