As we recently reported on CBT News, TrueCar has acquired the automotive retail and financial technology platform Digital Motors. Today on Inside Automotive, we dive into the details of this acquisition and the impact it will have on TrueCar and its customers. We’re pleased to welcome Mike Darrow, the President and CEO of TrueCar, and we’re also joined by Andreas Hinrichs, CEO of Digital Motors.
We want to be the first actual modern-day marketplace in the automotive space, Darrow says. In order to do that, TrueCar looked outside of the auto industry at retailers like Airbnb, Amazon, and Expedia that bring supply and demand together with innovative technology. The company aims to build technology that connects consumers with retailers in the TrueCar network.
Darrow explains that Digital Motors and TrueCar have good synergies and the companies were able to complete the acquisition. Lenders, OEMs, dealers, and others have access to virtual storefronts through the automotive retail and financial technology company Digital Motors, which streamlines the payment and financing processes for all parties involved in digital retailing transactions.
Some dealers, however, might not be convinced that digital retailing will grow or have a significant impact on their business. TrueCar enlisted a strategic company to gather insight into how quickly digital retailing will accelerate. By 2025, the company predicts that 40% of transactions will happen online in the automotive retail space. The real question becomes, who can build the right products to entice that level of volume?
The partnership between TrueCar and Digital Motors provides dealers with a turn-key digital retailing alternative without making an enormous investment.
“It’s about choice,” says Hinrichs. “We don’t want to dictate to the consumer on how they buy their next car. But we want to provide the conducive avenue where they can seamlessly transact online, and as much of the process online as they wish…The discussion is not so much about creating a hard cut-over from physical retail to only retail only, but to create a healthy mix of all the choices.”
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