CarPoint Joint Venture Marks Crossroads for Auto Industry and E-Commerce

SAN FRANCISCO, Sept. 20, 1999 — Imagine Jane Q. Public, waking up at 4 a.m. in the throes of new-car fever. She’s smitten by the buff styling of the Ford Explorer that she saw featured in the latest issue of Road and Track . She knows exactly what she wants: a five-speed, in candy-apple red, with plush leather seats, a 6-CD changer and a moonroof. So how does she make the car of her dreams the car in her driveway?

Soon, the Internet will go a lot further toward putting her in the driver’s seat, thanks to a joint venture announced today by Microsoft Corp. The e-commerce venture melds Microsoft’s popular MSN TM CarPoint TM online automotive service with the resources of leading car manufacturers, led by Ford Motor Co. The new entity — which continues to be called CarPoint — has pledged to develop the automotive industry’s first online build-to-order car-buying system that directly links consumers to manufacturers. Open to all makes and models, the system will let consumers purchase various brands of cars built to their precise specifications, at a variety of Web sites, beginning with and

Ford, a company that recognizes the power of the Internet, is the first automotive partner to invest in the CarPoint joint venture. The automaker views its alliance with Microsoft as an opportunity to make car-buying as pleasant and efficient as possible. Enabling people to shop for cars on their time, their turf and their terms, the company says, is part of Ford’s sweeping initiative to revolutionize the company and position itself as the automotive consumer leader.

“Ford takes a very aggressive approach to the Web and is actively building relationships with various categories of sites,”
says Thor Ibsen, manager of the Internet and new media team at Ford Motor Co.
“We see CarPoint as the leading automotive portal, both from a technology standpoint and from a customer experience standpoint. Ford is banding with Microsoft to add our competence to the equation and bring about a new buying process built on total consumer choice.”

Changing the Consumer Buying Experience for the Better

To understand what the CarPoint joint venture means for consumers, flash back to the scenario in which Jane Q. Public finds herself wide awake at 4 a.m., coveting a new sports car, minivan, truck or SUV. Still in pajamas, she sits down at her PC, fires up her Web browser, logs on to the CarPoint Build-to-Order system, and starts punching keys.

She enters information about the car she wants in specific detail — not just the make and model, but also the desired color, equipment and options, right down to the moonroof and the factory-installed child safety restraints. When she’s done, the system searches in a 200-mile radius and determines whether the vehicle she wants is available. In real time, she’ll know if her dream car is parked in the lot of a local dealer, in transit across the country, or due to roll off the assembly line soon.

The Build-to-Order system, due to debut for Ford vehicles in the first quarter of 2000, will also tell consumers when their local dealer will deliver the vehicle they’ve purchased. The bottom line: Consumers can find their new dream vehicle without leaving home or making so much as a phone call.

Contrast that experience with the traditional way of shopping for a car. A person might still lie awake in the wee hours of the night, eager to buy a new Camry, Corvette or Catera, but he’d typically have to bide his time until the weekend, trek across town to a showroom or three, then spend hours or even days looking for the right car and dickering over the price.

Technology Shapes Future of Online Automotive Marketplace

Combining Microsoft’s technology expertise with the automotive experience of top industry manufacturers is destined to dramatically change the way cars are bought and sold. Specifically, the Build-to-Order service that results from the CarPoint joint venture uses technology to put consumers in control of the car-buying process.

Research indicates that today’s car buyers embrace this vision. More than 65 percent of consumers acknowledge being overwhelmed by the car-buying process. Microsoft, Ford and the other auto manufacturers that endorse CarPoint as an online car-buying resource also welcome this fundamental business shift. Taking the plunge into the world of virtual car shopping is viewed as a natural evolution for the automotive industry.

CarPoint will offer manufacturers the front-end technology and team up with Microsoft Solution Providers to provide the back-end support that enables automakers to build customized vehicles to consumer specs. In many cases, the options and features that consumers want in a car may be perfectly feasible combinations — just not available at the local auto dealer’s lot because they don’t match industry forecasts. The Build-to-Order model capitalizes on technology to expand the concept of inventory beyond the dealer’s lot and up the supply chain.

“Say a consumer wants to configure a vehicle with certain equipment to match his lifestyle,”
explains Betsy Frost, CarPoint product manager at Microsoft.
“Through the power of technology on the back end, we can identify whether that vehicle has been built, conduct a search, and inform him where it is. We’re building intelligence into the locator tools to find as close a match as possible, or pose alternatives if a consumer is flexible. When a vehicle is found, the buyer can reserve it, then use CarPoint to observe its progress through the delivery process.”

Frost notes that this approach builds on the services that earned CarPoint its reputation as a comprehensive source of objective information and research tools. The joint venture takes CarPoint to the next level by offering consumers more choices, speeding up the car-buying process and making sure they get the car they want.

Fueling E-Commerce Through Partnerships

An outgrowth of MSN, the CarPoint joint venture is a core part of Microsoft’s strategy to build and foster new Internet businesses. The venture is also an important element of Ford’s e-commerce strategy. Both companies view their partnership as a way to consolidate the automotive industry, spur the success of e-commerce and deliver the services that consumers want.

“CarPoint has always teamed up with leaders in the automotive industry — from Reynolds and Reynolds to Kelley Blue Book — to provide the best online car-buying experience available,”
says Lindsay Sparks, CEO of the new CarPoint company.
“The next logical step in an e-commerce economy is to partner with manufacturers to revolutionize the way cars are bought and sold.”

Adds Ford’s Ibsen:
“Partnering with Microsoft assures us that Ford can take advantage of all the leading-edge technologies that Microsoft will bring to bear. As other manufacturers come into play, we know we can compete on speed and innovation and be confident that our products will succeed in the Internet marketplace.”

Consumers have made it clear, Sparks adds, that they like having one portal to access all the resources that the Web has to offer. To a company as consumer-driven as Microsoft, that sounds like a mandate. Microsoft acts on that imperative in three ways: by forging strategic relationships with industry leaders, by developing tools and technologies designed to improve their processes and supply chain functions, and by integrating its sites and services with those of its partners. The new CarPoint brings this model to the automotive industry, capitalizing on the power of technology to offer turbo-charged services to consumers, dealers and manufacturers.

Related Posts