Ford to sell cars in China via Alibaba’s Taobao – report

Ford to sell cars in China via Alibaba’s Taobao – report

Ford is expected to sign a deal with China’s Alibaba Group that may allow the carmaker to test selling cars to Chinese consumers via Alibaba’s online retail arm Tmall, formerly known as Taobao Mall. There will also be a new “auto vending machine” store concept, according to a Reuters report that quotes a Ford source familiar with the matter.

The report says that Ford bigwigs, including Blue Oval executive chairman Bill Ford Jr. and CEO Jim Hackett, are expected to be in Hangzhou today to sign a letter of intent that outlines the scope of the new partnership. Ford’s global chief spokesman Mark Truby said the company is expected to make an announcement today in Hangzhou, where Jack Ma’s Alibaba is based.

The source said the tie-up could mean that cars purchased online are delivered to buyers by franchised Ford retail stores and would be maintained and repaired by them.

Ford to sell cars in China via Alibaba’s Taobao – report

Ford could also use Tmall’s new retail concept called the “Automotive Vending Machine” — a multi-storey parking garage — to sell directly to consumers. Those cars could come directly from Ford or its dealers, with details still to be worked out, the unnamed source added.

Alibaba says that consumers can use their phones to browse the cars in the garage, before choosing to either test drive it or buy immediately. The chosen vehicle would be delivered to the ground floor.

Back to Fords on Tmall, the model allows shoppers with good credit to purchase a car with a 10% downpayment, and then make monthly payments via Alibaba’s Alipay. This model bypasses the traditional dealership, but Ford believes dealers would agree to this direct selling model because they still get to service the cars, the source explained.

Ford to sell cars in China via Alibaba’s Taobao – report

That won’t be the case, some experts say. “When online sales and direct sales volume was small that’s one thing. But if this format gained steam, it would definitely impact dealers. Retail innovation is great, but it’s by nature disruptive and can’t keep everybody happy,” said Yale Zhang, head of Shanghai-based consultancy Automotive Foresight. Dealers might also lose out on the lucrative financing aspect of their business.

Online car sales volumes are currently small in China because buyers want to be able to see, touch and drive cars before buying, Zhang pointed out. Getting a test drive via the internet could change that, though.

According to Reuters, Ford’s China sales have been sluggish in recent months partly because it has failed to catch on to fast-changing trends, including the rise of entry-level cars popular in smaller cities, where demand is rising. Ford’s sales in the first 10 months of 2017 were 938,570, a year-on-year decline of 5%. GM, which is much bigger in China, gained 2.2% to 3.13 million units in the same period.

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Danny Tan

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

 

Comments

  • nemesis on Dec 07, 2017 at 6:57 pm

    Proton via mudah.my

    Like or Dislike: Thumb up 12 Thumb down 1
    • Alexander Wong on Dec 07, 2017 at 10:44 pm

      Proton better sell in Lazada too cause their sales will be so bad after the new Myvi wipe them out

      Like or Dislike: Thumb up 3 Thumb down 4
      • dedak.gov.my on Dec 07, 2017 at 11:28 pm

        P1 lelong.com konfem laku gilerr

        Like or Dislike: Thumb up 7 Thumb down 0
      • Yup. At least P1 is receptive to modern tech and changes, unlike dinosar toyota still retaining deadwoods who come here bash 24/7. Tak laku letew

        Like or Dislike: Thumb up 0 Thumb down 0
  • Cars? Pfft! Taobao alredi selling Boeing 747s. If Tb start selling rockets & NK ICBMs, then im impressed.

    Like or Dislike: Thumb up 46 Thumb down 27
    • Alexander Wong on Dec 07, 2017 at 10:45 pm

      At least Ford is innovative and not just go and beg for money when sales are bad

      Like or Dislike: Thumb up 5 Thumb down 3
      • Oh yes, they did. Their CEO even went on his corporate business jet to White House begging to be saved.

        Like or Dislike: Thumb up 10 Thumb down 1
        • Donna Trump on Dec 08, 2017 at 12:34 pm

          MAS buy Boeing jets help feeding Amrika co. & Jude capital.

          Like or Dislike: Thumb up 0 Thumb down 0
        • tiadaid (Member) on Dec 08, 2017 at 2:31 pm

          Ford didn’t ask bailout actually. He asked only for R&D assistance, which is the same thing that Proton did ask for actually.

          Like or Dislike: Thumb up 0 Thumb down 0
          • Semantics. If basher can claim P1 R&D grant as bailout, they why cant I do the same as them?

            Like or Dislike: Thumb up 1 Thumb down 0
  • superdriver on Dec 08, 2017 at 8:52 am

    Lol, imagine you go to the website and the site says minimum purchase of 10 pieces… like buying baju or legos on Ali baba

    Like or Dislike: Thumb up 1 Thumb down 0
 

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