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Daewoo to sell cars on Net
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February 3, 1999: 3:32 p.m. ET
South Korean automaker to test drive first-ever e-commerce auto sale site
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NEW YORK (CNNfn) - In a pioneering move, South Korean automaker Daewoo soon will be the first car company to sell its vehicles directly to U.S. customers over the Internet in all but six states where franchise laws mandate the involvement of a car dealer.
While those in the market for a new vehicle now use the World Wide Web to comparison shop for the best price and value, until now the actual purchase of a car has to occur face-to-face in a dealership.
Daewoo Motor America will "test drive" its e-commerce site by mid-year or the third quarter in California, where the Division of Motor Vehicles has offered preliminary approval of its e-commerce model, Daewoo spokesman and communications manager Ron Schwenger said.
But the site is intended only to be "one other option" for customers and isn't meant to replace Daewoo stores or franchised dealerships, Schwenger said. He added, however, that there "may be value-added incentives, not price rebates" for purchases made on Daewoo's site and that those incentives likely would involve cross-promotions with products from companies such as Apple Computer.
To date, the South Korean automaker, which began selling cars in the United States only a few months ago, has 17 company-owned stores, with plans to increase that number to 90 by the end of fiscal 1999, Schwenger said.
In addition, it is projecting there will be 50 franchised dealerships in Maryland, New Jersey, New Mexico, Texas, Virginia and Wisconsin -- the six states that don't permit the direct sale of vehicles to consumers.
For those comfortable with the idea of buying a new car over the Internet, on receipt of a deposit Daewoo will bring the vehicle to the customer's home for a three-day test drive. The customer then will have the option to keep that car or order another from Daewoo's inventory. Payment for a car may be made over the Internet or by certified check upon delivery of another car.
When asked how Daewoo will prevent the sale of cars to those ineligible to purchase them, such as children, Schwenger said customers will be screened for "credit capability." 
-- from staff writer Jeanne Sahadi
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Daewoo Motor America
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