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Amazon’s next disruption may be auto dealerships

Nov 3, 2017

It seems every time you turn on the news, Amazon is expanding services again. Besides getting many  medium and large cities in the nation competing for the new Amazon Headquarters 2, we saw the big online commerce company buy brick and mortar Whole Foods. So where else is Amazon looking?

An article in Automotive News asks the question: "Could the Amazon of auto retail be Amazon itself?" Katie Burke, who wrote the story, joined Stateside to discuss Amazon’s future.

On Amazon’s experience in auto industry

Amazon doesn’t directly sell cars in America, but its toes are in the water. Besides selling aftermarket auto parts on its site, Amazon also sells cars directly in France (in a partnership with Seat) and in Italy (in a partnership with Fiat). There’s also Amazon Vehicles, which helps customers find cars that match their preferences. The site might be an effort to get “the consumer mindset to thinking of Amazon also as an automotive site,” said Burke.

On why Amazon is interested in dealerships

Auto dealerships provide much more to Amazon than just a space to sell cars. “They could pose as great distribution centers given the space of lots that they have and their location close to neighborhoods and city centers,” said Burke. “So, as car buying moves online, space opens up in these dealerships, kind of making them an attractive distribution center for Amazon to get other goods to customers quickly.”

On Amazon’s strategy of disruption

Amazon’s potential foray in auto sales is hardly surprising given the company’s history. The company “started from selling books online and now it’s one of the biggest companies in the world. And it’s gotten there by making unconventional business decisions,” said Burke. “So it seems like their main goal at this point is to disrupt brick-and-mortar sales but who knows what they could have their eye on next.” Burke ended with a bit of advice: “Expect the unexpected.”

Listen above for the full conversation.

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