Ford is on the verge of inking a deal with Alibaba that will allow the carmaker to sell its vehicles in China through Alibaba’s online retail arm Tmall, Reuters reports.
According to sources close to the matter, Ford chief executive Jim Hackett and Ford executive chairman Bill Ford Jr. are set to be in Hangzhou on Thursday to sign the deal. Ford is reportedly pursuing the deal in order to capture sales from the emerging marketplace where vehicles are being sold online in increasing numbers.
The deal will likely see cars purchased online being delivered to buyers by franchised Ford retail stores. The cars would then be maintained and repaired by these franchise locations.
Additionally, the partnership with Alibaba could lead to the latest ‘Automotive Vending Machine’ where vehicles are directly sold to consumers. Consumers could use the vending machine with an app, choosing to either immediately buy one of the vehicles or test drive one. The vehicle would then be delivered to the ground floor automatically.
Although the two solutions could make buying much simpler for consumers, not everyone is happy.
Speaking to Reuters, head of Shanghai-based consultancy Automotive Foresight, Yale Zhang, said it will hurt traditional dealers.
“When online sales and direct sales volume was small that’s one thing. But if this format gained steam, it would definitely impact dealers. Retail innovation is great, but it is by its nature disruptive and can’t keep everybody happy.”