Amazon is to start selling cars in the UK as the online monster looks to extend its reach into yet another new area.
The company is understood to have started recruiting salesmen for a trial that will start in Britain before being rolled out to other countries.
The company did run a trial selling Fiat 500 cars in Italy last year, but it is looking to go much further after signing distribution deals with German manufacturers.
Amazon is to start selling cars in the UK as the online monster looks to extend its reach into yet another new area
Any move into car sales will inevitably undercut the prices charged by mainstream dealers.
The highly secretive organisation has made no public announcement, however details have leaked in Germany.
The German trade magazine Automobilwoche has revealed that Amazon is planning to move into the European car trade – starting in the UK.
It said that industry specialist Christoph Moeller had been put in charge of Amazon’s European business with car makers.
He said that Amazon plans to run the business out of Luxembourg, which is uses to minimise its tax liabilities, and is looking at Britain as its probable pilot market.
E-commerce delivery expert ParcelHero issued a warning to UK car retailers after producing a report into Amazon’s expansion plans.
Its head of consumer research, David Jinks, said: ‘From books to consumer electronics, Amazon has completely transformed the market wherever and whatever it has launched.
‘Now the likes of Evans Halshaw and Bristol Street Motors will be taking a deep breath as it accelerates into the world of car sales.’
He said: ‘Amazon is looking at every branch of retail. There is small wonder that it is now looking at car sales.
‘Amazon is already actively making loans to its marketplace traders: it may be able to offer attractive loans on new cars in the future to its Prime Members, for example. Amazon is also likely to offer long-term lease cars.’
Mr Jinks added: ‘Mr Moeller’s claim that the UK will be its pilot market makes perfect sense. Amazon launches many of its ideas in the UK before the US and internationally.
The company did run a trial selling Fiat 500 cars in Italy last year, but it is looking to go much further after signing distribution deals with German manufacturers
‘For example, Amazon trialled its own delivery arm, Amazon Logistics, in the UK before it launched it elsewhere, in order to perfect its one hour Prime Now service before commencing its own deliveries in America.
‘Amazon trialled selling small Fiats in Italy last year, with some success; but even the dinky Fiat 500 can’t be left under your doormat or in your porch.
‘Amazon will likely have to work with an established car distributor to deliver your new car; introducing an entirely new supply chain.’
Lisa Bedwell, senior research director at Future Thinking, said: ‘Amazon’s ambitious move to take on the automotive market and sell vehicles directly in the UK is an exciting game changer which will be making established automotive traders nervous.
‘While key existing players such as AutoTrader are likely to take steps to offer a more tailored, specialised service to differentiate from Amazon, for automotive brands there is an opportunity to push for these platforms to offer more space where they can build a closer relationship with customers.’