The deal promises participating dealers that the number of online offerings of cars and trucks will "at least double." Dealers who are members of FordDirect now generally list only new Ford vehicles on their sites. AutoTrader's plan will allow dealers to eventually sell used vehicles by Ford or any other automaker.
Used vehicles that will soon appear on Ford dealers' sites will also be for sale at AutoTrader. The Atlanta-based online automobile company says it generates 5 million unique visitors a month, making it the biggest used-car site in the world.
The venture could help Dearborn, Mich.-based Ford solve a big problem for the automobile industry as it embraces the Internet: how to localize online offerings and list cars available in specific regions of the country, yet simultaneously build simple, streamlined sites that are easy for dealers to maintain.
Although more than half of all U.S. automobile shoppers are researching vehicles online, according to J.D. Power and Associates, many automobile shopping sites are relatively complicated to use.
"This is an enormous breakthrough for Ford dealers," Devon Cohen, CEO of FordDirect, said in a statement. "With 40 million to 45 million used-car sales a year in the United States, the potential is huge."
AutoTrader was created in 1997 and is a majority-owned subsidiary of 56-year-old Manheim Auctions, the world's largest operator of wholesale auto auctions. Manheim is a wholly owned subsidiary of media conglomerate Cox Enterprises. AutoTrader's principal stockholders also include online auction giant eBay and the venture capital firm Kleiner Perkins Caufield & Byers.
FordDirect operates in 21 states and represents more than 70 percent of the Ford brand's total new car and truck sales volume in the United States. Ford is making the program available to the remaining 30 percent, and the program is expected to be completed in 2002.