GM Launches Japanese Online Auto Shopping Service

General Motors, Suzuki Motors, Fuji Heavy Industries and Isuzu Motors announced they have formed a joint venture company, Japan Auto Web Services. The first item on the new company’s agenda, executives said, is the immediate establishment of BuyPower Japan, an online automotive shopping service.

BuyPower will allow Japanese auto buyers to search, select, get pricing on models and options, and even configure a Cadillac, Saab, Opel or Chevrolet online.

The new venture is a significant one for the participating companies – and a milestone for the Japanese consumer.

Market Dynamics

For GM, Suzuki, Fuji and Isuzu, the new venture is a no-brainer. Despite the country’s economic woes of the last decade, Japanese consumers still have a great deal of disposable income at their command and are among the most active online shoppers in the world.

Japan has some 47 million Internet users, Mark Hogan, GM group vice president responsible for e-commerce, has said in wire reports and news accounts. More importantly, last year the country accounted for 62 percent – or US$9.5 billion – of regional e-commerce, he added.

As for Japan Auto Web Services, the new company’s combined market share automatically has made it the number two automotive group in Japan with some 17 percent of the market, according to Rudolph Schlais, GM group vice president and president and CEO of GM Asia Pacific.

Consumer Tastes

Japanese consumers will have a number of new choices and service options at their disposal. Customers will be able to choose from 65 vehicle models in 179 variations, ranging from compact cars to larger, luxury sedans.

Like many other car-buying Web sites, BuyPower Japan offers shopping preliminaries –the ultimate sale must be finalized at a local dealership participating in the venture. However, while this may be considered a hassle in the United States, in Japan the consumer tends to value the face-to-face transaction.

GM hopes that the venture will go a long way toward changing the Japanese perception of American cars and American sales methods. While many imported brands – especially those from Europe and in particular, Germany – are highly valued in Japan, U.S. imports do not have as much cachet.

Goal To Expand

GM said it would like to expand its auto exports to Japan to about 100,000 units a year from its current level of 35,000. The new Web site, the company anticipates, will help it reach that goal.

A similar initiative launched a few years ago by GM in South Korea and Taiwan, called “GMBuyPower.com,” has thus far been very successful, according to news accounts. The company also launched a site in China earlier this year.

Each site is designed to address consumer preferences, buying habits and distribution channels for its particular market.

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