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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

Caitlin Owens, author of Vitals
11 mins ago - Health

The U.S. is approaching the vaccine hesitancy "tipping point"

Expand chart
Data: CivicScience; Chart: Axios Visuals

The U.S. will probably run out of adults who are enthusiastic about getting vaccinated within the next two to four weeks, according to a KFF analysis published yesterday.

Between the lines: Vaccine hesitancy is rapidly approaching as our main impediment to herd immunity.

Ben Geman, author of Generate
34 mins ago - Energy & Environment

The finance sector links arms on climate

Illustration: Eniola Odetunde/Axios

A big, UN-backed umbrella group of banks, asset managers, investors and insurers launched Wednesday to boost private clean tech finance and press polluting industries that use their services to cut emissions.

Why it matters: The Glasgow Financial Alliance for Net Zero (GFANZ) is the broadest financial industry effort yet on climate change.

Scoop: Chris Christie friends believe he's running in 2024

Chris Christie at the White House in 2020. Photo: Chris Kleponis/Polaris/Bloomberg via Getty Images

Former New Jersey Gov. Chris Christie is seriously considering running for president in 2024, three people familiar with his thinking tell Axios.

Driving the news: While Christie isn't saying anything publicly about his thinking — besides telling radio host Hugh Hewitt he's not ruling it out — people close to him have an early sense of the rationale and outlines of a potential candidacy.