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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

Updated 39 mins ago - Energy & Environment

Thousands without power as "hazardous" winter storm lashes East Coast

Satellite imagery of the Northeastern U.S. taken by NOAA on Jan. 17. Photo: NOAA

A major winter storm lashed much of the East Coast Sunday and Monday, causing widespread power outages and disrupting travel over the holiday weekend.

The latest: Authorities in North Carolina confirmed that two people died in a car crash and that they responded 600 vehicle accidents during the storm on Sunday, per the Washington Post.

CDC director says COVID-19 messaging should have been clearer

Rochelle Walensky. Photo: Stefani Reynolds-Pool/Getty Images

Rochelle Walensky, director of the Centers for Disease Control and Prevention, said in an interview with the Wall Street Journal that the messaging around the COVID-19 pandemic and changing guidance should have been clearer.

State of play: Walensky is being coached by media experts and is planning to have more press briefings by herself in order to ensure that CDC is seen as an independent, scientific entity, rather than as a political one, the Journal reports.

2 hours ago - World

UAE asks U.S. to reinstate Houthi terrorist designation after attack

Secretary of State Tony Blinken (left) listens to United Arab Emirates Foreign Minister Sheikh Abdullah bin Zayed al-Nahyan during a joint news conference at the State Department iin October. Photo: Andrew Harnik/Pool/AFP via Getty Images

Emirati Foreign Minister Abdullah Bin Zayed asked Secretary of State Tony Blinken in a phone call Monday to re-designate the Houthi rebels in Yemen as a terrorist organization, a senior Emirati official told Axios.

Why it matters: Less than a month after he assumed office, President Biden rolled back the Trump administration’s decision to make the designation. He said it hampered humanitarian assistance to the Yemeni people. Since then, the Houthis have escalated their attacks against Saudi Arabia and other countries in the region — including an attack Monday in Abu Dhabi.