Online payment shock for AA's vehicle sales

One-fifth of the users of the Automobile Association's Internet and telephone car buying service have carried out the entire...

One-fifth of the users of the Automobile Association's Internet and telephone car buying service have carried out the entire transaction online. The figures mark a major shift in the online car buying market, analysts said this week.

The AA Buyacar service, which went live five weeks ago, has so far given quotations to 200 customers and has received 50 orders for cars, 10 of which were paid for online. Until now, consumers have generally browsed Web sites for vehicle details and paid offline.

Although the numbers are small at the moment, the 20% figure buying online could be "massive", according to Laurence Stock, an analyst at research group Datamonitor.

"Online car buying services have been out there but they have not taken off," he said. "If these figures are translated to the overall market, it will mark a major shift in the way people are buying cars."

Richard Williams, managing director of AA Buyacar, admitted he was surprised at the number of customers paying online, but said the fact the service was focusing on used, as well as new, cars was a factor.

"When people have made their minds up about a mid-priced car, they are more willing to buy unseen," he said. "In the UK, 70% of all cars sold each year are not new. It is a potentially huge market which has, up to now, not been tapped by Internet dealers."

Williams said the service will be developed further over the next year. It will aim to overcome the difficulties faced by online car retailers when a buyer wants to part-exchange his current car.

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