uploads/2018/04/8.jpg

Alibaba as a Car Dealer

By

Updated

Alibaba and Ford unveil vehicle vending machine

Alibaba’s (BABA) massive audience of more than 515 million active shoppers in China seems to be a treasure that global automobile manufacturers are positioning themselves to tap into. In late March 2018, Alibaba and Ford Motor Company (F) unveiled a unique car vending machine in the southern Chinese city of Guangzhou, building on the commercial collaboration partnership they started in December.

The vehicle dispensing machine launched in partnership with Ford is designed to simplify the car-buying process for Alibaba customers. A customer can buy a car through the machine in just ten minutes without human help.

Article continues below advertisement

Renault looking to sell cars on Alibaba sites

Alibaba also has a car leadership pact with French carmaker Renault. Renault will be able to sell its cars through Alibaba’s online platforms in China. The deal with Alibaba comes at a time when Renault is placing a big bet on China as it looks to grow its vehicle sales in the country fivefold in the next five years.

About 28.9 million vehicles were sold in China last year, according to CAAM (China Association of Automobile Manufacturers). In 2016, 28 million vehicles were sold in China compared to the 24.6 million vehicles sold in the country in 2015.

China’s expanding population of middle-class consumers is driving car sales in the country.

Automakers and digital companies forge alliances

As electric vehicles and driverless vehicles become more popular with drivers, traditional automakers are partnering with digital companies to both remove frictions in the vehicle-buying process and develop technologies to simplify driving or make cars fancier. Alphabet’s (GOOGL) Waymo is about to launch a taxi service using a fleet of driverless cars in the United States. Ford and General Motors (GM) have also shown interest in venturing into the driverless taxi business. In China, Baidu (BIDU) is aiming to launch a driverless bus this year.

Advertisement

More From Market Realist