Ford, Alibaba to test online sales, car vending machine concept?

Ford signs strategic agreement with tech juggernaut Alibaba to investigate new retailing opportunities in China.

Chris Paukert Former executive editor / Cars
Following stints in TV news production and as a record company publicist, Chris spent most of his career in automotive publishing. Mentored by Automobile Magazine founder David E. Davis Jr., Paukert succeeded Davis as editor-in-chief of Winding Road, a pioneering e-mag, before serving as Autoblog's executive editor from 2008 to 2015. Chris is a Webby and Telly award-winning video producer and has served on the jury of the North American Car and Truck of the Year awards. He joined the CNET team in 2015, bringing a small cache of odd, underappreciated cars with him.
Chris Paukert
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Ford and Chinese tech juggernaut Alibaba have signed a comprehensive deal to explore new ways of selling cars in China. 

The plan calls for exploring test-selling automobiles both online and at physical locations, Reuters reports. The multipronged "letter of intent" means that Ford and Alibaba will jointly explore opportunities around cloud computing, artificial intelligence, mobility services, digital marketing, and online retailing for at least three years.

According to Reuters, Ford will investigate leveraging Alibaba's Tmall online store to sell new vehicles, as well as its new "'auto vending machine' store concept," an idea that sounds more than a bit like what used car retailer Carvana has pioneered with increasing success. 

The vending machine will reportedly allow prospective customers to view a store's inventory on their phones, as well as summon them to the ground floor for a test drive or even purchase them outright. Eligible customers will be able to put 10 percent down on their new vehicles and finance the rest through Alibaba's Alipay.

Ford CEO Jim Hackett and chairman Bill Ford
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Ford CEO Jim Hackett and chairman Bill Ford

Ford and Alibaba execs have signed an agreement to jointly explore new ways to sell cars and services in China.


Vehicles purchased online through Alibaba's Tmall may be delivered and serviced through Ford dealers, and indeed, the same could apply to vehicles found in the company's vending machine buildings.  

Ford will likely have to work hard to assuage any concerns of its dealer body with any Alibaba deal, as their existing network of retailers could grow concerned that they're being cut out of new vehicle sales and financing opportunities. Direct sales from automaker to consumer are possible in China and other global markets, but the practice is generally illegal in most US states. 

When Roadshow reached Alibaba and Ford reps by phone, neither immediately offered a comment on this story.

Update, Dec. 7: This story has been updated to reflect the signing of the letter of intent, along with new details about the agreement's areas of focus.