Car buyers want online transactions, but hurdles remain


Dave Smith Motors sells about 150 used vehicles a month to online customers, many of them far from the Kellogg, Idaho, store. But while those buyers can complete much of the paperwork electronically, the dealership still must overnight a packet of documents that need wet signatures.

Though ads by Carvana tout that consumers can buy 100 percent online, the used-vehicle upstart acknowledges that some forms must be signed in person. A recent Carvana customer needed four online chat sessions, eight phone calls and 15 pieces of paper to sign upon delivery — and he had arranged his own financing.

Even after years of consumer requests and industry promises about buying vehicles online, “there seem to be some stumbling blocks there,” outgoing NADA Chairman Wes Lutz, owner of Extreme Dodge-Chrysler-Jeep-Ram in Jackson, Mich., told Automotive News. The nation’s auto retailers will be looking for solutions as they meet this week in San Francisco for their annual convention.

Across the country, dealership websites increasingly feature Buy Now, Express Purchase and similar buttons for online shoppers. But can consumers really buy a car completely online — like they buy an outfit or gift on Amazon — with a few mouse clicks? For the most part, not yet. Barriers include financing approvals and varying requirements for wet signatures on regulatory documents such as title applications, power of attorney forms and federal odometer statements.

Still, progress is being made, with dealers and vendors increasingly implementing new online capabilities. And consumers are doing much more paperwork electronically than just a few years ago.

Dave Smith Motors, for instance, lets customers complete e-contracts via DocuSign, RouteOne and Darwin Automotive.

“We find that especially the younger generation like to sign remotely — the Amazon approach,” said Reuben Robinson, finance director at the Idaho dealership, which has used RouteOne’s Remote eSign platform on finance contracts for about a year. “The dealership benefits by faster funding, a fully committed customer and increased customer satisfaction.”

The store does complete online financing deals, but it isn’t easy with three technology portals needed to finish the transaction, Robinson said.

While laws and infrastructure are in place for dealerships to originate a vehicle sale or lease via the Internet, only a small number of dealerships and finance companies use the technology, said Justin Oesterle, CEO of RouteOne, a suburban Detroit e-contracting company. RouteOne processed its first remote electronic signature on an auto finance contract in late 2017.


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