Amazon, eBay Step Up Their Game Plan For Automotive

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These days, whenever I meet with car industry executives, I invariably get asked this one question: “So, what is Amazon’s strategy in automotive?”

The U.S.-based eRetailer has never been shy of grabbing headlines and minds. From drone deliveries to its recent purchase of Whole Foods Market, Amazon is generally recognized as the global leader of disruption, especially in retail.

Now, Amazon, along with other digital players such as eBay, is increasingly bringing these disruptions to the automotive world.

Both companies found most of its success in the parts business in North America. In the U.S. alone, Amazon and eBay together account for over 70 percent – an estimated value of $7-7.5 billion – of all car parts sold online, according to Frost & Sullivan estimates published in its recent report titled, Competitive Profiling of eRetailers in Americas. However, Amazon and eBay share of online part sales is lower in Europe because of the strengths of various localized players, but substantial in markets such as the U.K. and Germany.

For Amazon, its parts and accessories business has been one of its fastest growing business units as it continues to attract more direct business from suppliers and car companies. In its report titled, Strategic Analysis of eRetailing in the Global Automotive Aftermarket, Frost & Sullivan predicts at least 10 to 15 percent -YoY growth by 2022 for B2C online part sales in the U.S. and Western European markets. In emerging markets such as India, the volumes will be even more explosive; Amazon is expected to drive and capture much of this growth.

Lately, the pace of disruption from Amazon and eBay has expanded beyond car parts sales to new fields within the auto industry’s ecosystem. Amazon recently piloted online car sales with European units of Fiat, Opel and Hyundai, and there are clear signs according to recent news reports that the company will expand its digital car business – most likely in the UK market for starters.

Amazon CEO Jeff Bezos’ automotive vision was also evident in some of the recently announced collaborations with OEMs such as Ford and VW, to implement the Alexa voice-recognition software in cars. This was abundantly clear at the CES show in Vegas earlier this year when both companies showed pilots of how Alexa could provide advanced connected living and ecommerce services between the vehicle, driver and home

eBay, an early pioneer but clearly now seems threatened, is also upping its game. The San Jose, California-based company is boosting its vehicle marketplace through collaborations with vehicle comparison website TrueCar. It also introduced installation services for tire sales in Germany and plans to roll the program out in the U.S. as well this year.




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