Some people on the web are currently blasting the new partnership between Amazon and Hyundai because they’re still experiencing big markups on cars. The thing is that the new system isn’t even in place yet as it won’t be available until early 2024. Nevertheless, the concern about markups is surely valid and one that Hyundai indirectly confirmed to us.
The confusion arises from the fact that while Hyundai announced a new strategic partnership with Amazon for 2024, it currently operates a digital showroom on the e-commerce giant’s website called the ‘Hyundai Evolve Showroom.’ This platform allows shoppers to research and compare vehicles but does not facilitate direct purchases through Amazon.
Instead, the ‘Hyundai Evolve Showroom’ currently serves as a lead generation tool, connecting users with dealers who have the desired car in stock. The new version will enable users to complete the purchase of a new car on Amazon’s site and then arrange for pick-up or delivery through their local dealership.
So, what happened?
An X user (formerly Twitter) recently complained about their experience on Amazon surrounding an effort to buy a Hyundai with the tweet (are we still calling that?) gaining traction on social media. They selected a Hyundai Ioniq 6 Limited and attempted to move forward with their purchase. The dealer in their case responded with a pricing sheet that included a $3,000 market adjustment. That same poster appears to have mistaken what they experienced with what Hyundai and Amazon just announced for 2024.
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We wanted to be sure that we had the facts straight, so we reached out to Hyundai about the matter. They informed Carscoops that indeed, this isn’t the same system but also highlighted that dealers will still be allowed to set the final price in the upcoming system. Here’s the full statement.
“The screenshots in that posting on X appear to be from the current digital showroom experience which links customers to dealer websites. This is different than the new customer sales experience we announced with Amazon last week at the LA Show”, a spokesperson told us.
“The latter, which kicks off in 2024 with a pilot program before rolling out to all customers, will have the entire vehicle purchase transaction take place on Amazon. It’s worth noting that even with this new program dealers will remain the sellers of record and they will also set the pricing for their vehicles,” he added.
So, there’s still a significant question mark: How will Hyundai prevent dealers from significantly raising prices over MSRP? From a legal standpoint, Hyundai has limited options, but as other automakers have shown, there are certain measures that can discourage this practice.
As we mentioned in our first piece on the initial announcement, simply having the ability to easily compare one dealer’s price to another has proven to be beneficial for customers. If one dealer is willing to charge a greedy markup and another isn’t, that should sway buyers. Of course, the opposite is possible too. Dealers could see the “going rate” of others in the area and jack their own prices up to match.
We’ve reached back out to Hyundai to comment about whatever strategies it might use but we haven’t heard back as of this writing. If they respond we’ll be sure to update you on the latest.
