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GM's trial program selling cars on eBay set to end

Wed, 09/30/2009 - 5:01am

Editor's Note: Ideas like this have potential, but I would never make such a large purchase online, particularly without seeing it first (and "it" being autos--test driving it).

(AP) -- General Motors Co. said Tuesday that it is concluding its partnership with eBay Inc. in which the automaker used the auction site to sell new cars through California dealerships, as it shifts focus to broader, national marketing programs.

GM and eBay said the program was slated to end Sept. 30, and was not canceled for lack of participation. GM spokesman John McDonald deemed the program a "success" because it helped the Detroit-based company improve strategies to reach car buyers who typically don't consider GM products.

"We're taking what we learned from eBay and applying it to our digital and social marketing media marketing strategies," he said. "From our view, it was a success."

Through eBay's auto marketplace, car shoppers in California were able to negotiate a price with a dealer, or purchase the vehicle at a fixed price and pick it up at a dealership.

The eBay site received 1.5 million hits, or visits, producing 15,000 leads for dealers. About 227 California-based dealerships participated in the program. GM and eBay did not say how many cars were sold based on the program.

McDonald said GM would focus on its new, national marketing campaigns and its money-back guarantee program in which dissatisfied buyers can return their vehicles within 60 days.

Inder Dosanjh, who runs four GM dealerships and currently sells used cars on eBay, said he didn't sell very many new cars through GM's eBay program.

Very few people chose the "Buy Now" price option, said the owner of Dublin GMC Buick in Dublin, Calif., with consumers preferring to come into a dealership to make such a large purchase.

"Most people got online and looked at the inventory and came on down to the dealership," Dosanjh said. "It was not a complete disappointment."

For eBay, the end of the program doesn't mark an end to its relationship with GM or future plans to sell new cars from other automakers in a similar fashion.

"The fact that this program itself may not continue as a promotion is not necessarily" indicative of our relationship with GM, said Rob Chesney, VP of eBay Motors.

Chesney said eBay may seek to develop similar programs with other automakers, but did not offer specifics.

Shares of San Jose, Calif.-based eBay fell 5 cents Tuesday to close at $23.87.

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