Amazon (AMZN, Financial) is strengthening its presence in the automotive market by expanding its car sales project to include more brands. Following its collaboration with Hyundai, Amazon plans to introduce a used car sales service on its platform, marking a further expansion in the automotive sector. This initiative is part of Amazon Autos, which recently transitioned from a closed test phase to an open test phase. The project is now operational in 68 markets, a significant increase from 54 markets earlier this year.
Fan Jin, Amazon's Director of Automotive Business, highlighted that Amazon Autos aims to help partner dealers maximize inventory clearance. The focus remains on dealers, offering comprehensive service support to enable them to sell products in their preferred manner. For consumers, the project aims to simplify the car buying process, providing a convenient online shopping experience while maintaining the existing dealership framework.
Additionally, Costco (COST) has seen notable success with its car recommendation program for members. Analysts predict that as Amazon and Costco continue to expand their car purchasing programs, traditional automotive retailers like CarMax (KMX), AutoNation (AN), Lithia Motors (LAD), and Carvana (CVNA) could face increased competitive pressure.
