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Illustration: Sarah Grillo/Axios

It took a pandemic to drag the car-buying process into the 21st century — and consumers are never going back.

Why it matters: After COVID-19, consumers can now buy cars online as they do almost everything else, with the ability to complete the entire transaction digitally and take delivery without ever setting foot in a showroom.

The big picture: While most other commercial transactions — even banking — went digital years ago, car-buying remained a stubbornly low-tech, often aggravating, process.

  • But when the public health crisis paralyzed their industry, car dealers had little choice but to embrace the disruptive changes they'd been resisting for decades.
  • They scrambled to install new software that would let customers browse inventory, apply for credit and choose a payment schedule.
  • And they offered virtual test drives to demonstrate in-car technology and arranged "touchless" vehicle pickup and delivery.
"Consumers really like it. Surveys show they want more of it, and dealers are getting on board that this is how it's going to be."
— Michelle Krebs, executive analyst at Cox Automotive

The backstory: Technology entrepreneurs — and sometimes even carmakers themselves — have tried for years to modernize the car-buying process.

  • In the early 2000s, Ford even tried (unsuccessfully) to buy and operate dealerships in competition with its independently franchised dealers, thinking it could run them better.
  • Since then, newcomers have tried various digital retailing efforts, but none with any great success.
  • Car dealers, protected by state franchise laws, often were the biggest obstacles to change.
  • Tesla's direct-to-consumer sales model, for example, met fierce resistance from dealers in many states, requiring lengthy court battles or negotiated settlements with state governments, though Tesla eventually won.

For the record: Some progressive dealers have been exploring online sales initiatives for several years.

  • But many worried their profit margins would suffer if they weren't able to upsell buyers with extras like extended warranties or plush floor mats.
  • It turns out that dealers are more profitable than ever since shifting to online sales, Krebs noted.
  • "The deal happens faster because the consumer knows exactly what they want, and there's not a lot of haggling on the price," she said.
  • Yes, but: Prices are high also because inventories are limited due to COVID-related factory shutdowns earlier in the year.

The state of play: Dealers are now touting their "omnichannel" tech strategy to provide consumers a seamless buying experience whether they shop online, in store or both.

  • Nissan, for example, just launched a new online shopping platform called Nissan@home that lets prospective buyers schedule a test drive, sign the paperwork and arrange delivery of their new vehicle from their computer or mobile device.
  • Sonic Automotive, a large publicly traded dealer group, recently hired its first chief digital officer and vice president of e-commerce with the goal of doubling its annual revenue by 2025.

The bottom line: A three- or four-hour showroom visit can be compressed into a 15-minute online purchase.

Go deeper

VA first federal agency to require COVID vaccines for employees

A medical doctor gives the thumbs-up sign to a COVID-19 patient who is no longer using a respirator at the Veterans Affairs Medical Center in New York City. Photo: Robert Nickelsberg/Getty Images

The Department of Veterans Affairs said Monday it would require its frontline health care workers to get vaccinated against the coronavirus within the next two months, the New York Times reports.

Why it matters: The VA is the first federal agency to mandate that employees receive the vaccine. The decision comes as cases of the Delta variant in the U.S. have increased dramatically.

3 hours ago - Health

Biden: Americans with long-COVID symptoms may qualify for disability resources

President Biden speaking in Arlington, Virginia, on July 23. Photo: Oliver Contreras/Sipa/Bloomberg via Getty Images

Americans experiencing long-term symptoms of COVID-19 may qualify for disability resources from the federal government, President Biden announced Monday during an event to mark the 31st anniversary of the Americans with Disabilities Act.

Driving the news: The departments of Justice and Health and Human Services released new guidance Monday that categorizes “long COVID" as a physical or mental impairment, entitling people with the illness to discrimination protections under the the ADA.

Study: Get ready for many more record-shattering heatwaves

NASA computer model image of temperature departures from average on June 27 during the Pacific Northwest heat wave. (NASA Earth Observatory)

The recent deadly heat wave in the Pacific Northwest, during which all-time temperature records were shattered by several degrees, is a prologue to what is coming across much of the U.S., Europe and Asia, a new study finds.

Why it matters: The study shows that the rate of climate change is an under-appreciated driver of extreme heat, and that today's quickening pace of warming virtually guarantees more extreme temperature records in coming decades.