William Flew Online Car Sales

 Tesco is taking its business from the supermarket aisles to the motor trade with the launch of its own second-hand car dealership.

Tescocars.com, which was launched yesterday, is selling former business fleet and rental cars directly to customers shopping online. It hopes to grab a slice of a market said to be worth £24 billion each year in Britain.

The website is offering a choice of about 3,000 cars, ranging in age from six months to three years, with more set to be added to the site each day.

Through a “lifestyle option” search, customers can look for vehicles that match criteria such as budget, size, ecofriendly credentials, even colour. They will not test drive the car before purchase but can watch an online video of an RAC test drive.

But it won't be one of these

Buyers will pay a £99 handling fee and £149 delivery charge for any address in the mainland UK. Customers who do not wish to pay a delivery fee can collect the vehicle from a handover centre at Longbridge, Birmingham.

Tesco said that it was including 2,000 Tesco Clubcard points as part of a purchase. The car can be returned within seven days, with the loss of the handling and delivery fees.

The company claimed that it could sell cars about 20 per cent more cheaply than traditional dealerships. Andrew Higginson, its chief executive of retailing services, said: “By supplying directly to the customers, there is no middle man, no expensive showroom and no salespeople on commission. Buyers can be sure they are getting the best value out there.

Or one of these

“We are offering a wide choice of the most popular models from small hatchbacks to executive saloons to family-sized MPVs. Each and every vehicle will have passed a 167-point RAC inspection.”

Tesco is also providing other services, including vehicle repairs and MOT testing, from more than 1,000 independent garages through an arrangement with National Service Network. It can already replace a car’s tyres, after its tie-up with Blackcircles.com and the launch of Tesco-tyres.com. It provides car insurance and other services through Tesco Insurance.

Or this

The supermarket group said that it would not buy second-hand cars from its customers or allow trade-ins and partexchanges of customers’ cars.

This is just the latest diversification for Tesco, which, in its relentless drive for profits, has already branched out into providing banking services, pet insurance and even film production. Moreover, the entry of such a juggernaut into the world of second-hand cars is likely to worry both existing online sellers — the likes of Autoquake, which has a similar business model — and the franchised dealers. If there is a significant take-up of the service, the supply of used cars could begin to dry up for existing dealerships, in turn pushing up prices.

Or

Tesco’s venture is not without risk, however. There have been some significant casualties in selling cars online. Direct Line and Royal Bank of Scotland’s Jamjar.com was the first big online new car retailer, but it is no longer operational. In addition, car sales could be hit by the continued high price of fuel and the Government’s austerity drive, which is expected to be felt more severely by consumers this year.