Amazon's latest move into online car sales could spell disaster for struggling used car retailer Carvana, as the e-commerce giant launches direct new vehicle sales with Hyundai.
The newly unveiled Amazon Autos platform now allows customers to purchase new Hyundai vehicles directly through Amazon's trusted interface in 54 U.S. markets. This development marks the first time a major automaker has partnered with Amazon for direct vehicle sales.
The platform offers a seamless car buying experience that closely mirrors Carvana's model - but with the backing of Amazon's massive infrastructure and customer base. Shoppers can browse vehicles, arrange financing, and complete paperwork electronically, all while enjoying transparent, no-haggle pricing.
This partnership poses a major threat to Carvana's already precarious market position. While Carvana focuses on used vehicles, Amazon's entry into online car sales with a major manufacturer like Hyundai demonstrates how traditional dealers and tech giants can successfully collaborate in the digital age.
The Amazon Autos platform covers markets representing 71% of Hyundai's U.S. sales volume, with plans for expansion throughout 2024. Unlike Carvana's struggles with state franchise laws, Amazon's model works within existing dealer networks, allowing for completely legal direct-to-consumer sales.
For Carvana, which has faced ongoing financial challenges and skepticism about its business model, Amazon's entry into online car sales represents yet another obstacle to profitability and market share. The company now faces competition from one of the world's most trusted and efficient e-commerce platforms.
As Amazon plans to expand its automotive retail presence, this could mark the beginning of a larger transformation in how Americans buy cars - one that may leave struggling players like Carvana behind.