No. 1 automaker General Motors said on Friday it will form a joint venture with its US dealers to sell all its various makes and models of cars and trucks over the Internet.
Bill Lovejoy, head of vehicle sales, service and marketing, told over 7,000 dealers in an e-mail that GM is moving forward on the 50-50 joint venture, which it initially proposed in August.
"We are proceeding with the next steps required to make the joint venture a reality," he wrote.
GM and the dealers are negotiating the details of the venture, including pricing and referral fees, and hope to have it operational by the first quarter of next year, a GM spokesman said.
"We are looking at all possible options to determine the best path forward," Lovejoy said.
In response to growing vehicle sales over the Internet through third-party Web sites, GM said on Aug. 14 it was considering forming the joint venture to sell all its vehicles. A positive response from dealers it contacted led GM to declare its intention to proceed, Lovejoy said.
The automaker said then the proposed Web site -- which Lovejoy said would legally be separate from GM -- would capitalise on consumers` preference to shop for new vehicles on sites that are unaffiliated with any automaker.
The new site would thereby reach consumers who would not visit GM`s existing site, GMBuyPower.com.
Lovejoy said the joint venture will allow GM and its dealers to move forward with a two-pronged Internet strategy.
"First GM BuyPower will remain a critical part of the strategy by offering the consumer an (automaker) branded online experience," he said. "Second, our new joint venture will allow GM and its dealers access to consumers who are interested in an all makes/all models independently branded online experience."
Many dealers subscribe to independent, third-party Web sites, such as Autobytel.com, and pay around $20 to $30 for each vehicle sales referral. GM said on Friday it has not decided whether the new Web site would also charge such fees.
GM, which has worked to shore up its dealer relations, said in August it expects consumers seeking to buy competitors` models would be referred to their dealers or directly to the competing automaker. GM buyers would be referred to GM dealers and might be able to view available inventories of cars and trucks.
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