Online Car Sales Valuable Tool in Canada’s COVID Era

OTTAWA – Canadian auto dealers and brands have been developing technologies enabling remote vehicle sales when COVID-19 social-distancing restrictions impede the physical operation of dealerships.

Even with these rules relaxing – with much of Ontario entering a ‘stage 3’ reopening from July 17, and dealerships fully open – physical distancing will still be required on premises.

That means online sales will continue to be attractive alternatives, and retailers are innovating to generate internet traffic. For example, Toronto-based Trader Corp. has launched a Remote Selling Suite which helps dealers interact with customers online through the company’s autoTRADER.ca business-to-consumer platform.

The system enables dealers to talk to potential buyers using online chat, recording and sharing a walkaround tour of a vehicle. According to a Trader Corp. presentation, this replicates “the experience of visiting a showroom in person and allows sales staff to convey their personalities while providing the elevated customer service they would normally demonstrate in person.”

The system also allows customers to book 24-hour at-home test drives. Serious customers also can reserve a vehicle and place a deposit through the Remote Selling Suite.

Rival online market Carpages.ca has been operating a “Buy From Home” service enabling customers to buy a vehicle remotely from more than 200 participating dealers across Ontario. It also enables customers to conduct virtual inspections from home, e-sign documents, schedule home test drives and arrange for a vehicle to be delivered after purchase (below).

Mindful of concerns about online sales deception, the company advises against buying vehicles that cannot be viewed or inspected prior to purchase, with consumers insisting dealers’ video chat displays “every detail of the vehicle remotely.” And with remote purchases, dealers must provide vehicle history reports, such as CARFAX, detailing previous owners, damage or insurance claims, says Carpages.ca.

carpages.ca delivery

Brands also have been developing direct online sales tools. Toyota Canada has added an “Easy Shop Video Chat” tool to Toyota.ca. It allows online customers seeking a new vehicle “to speak face-to-face with a product advisor at the Toyota dealer of their choice.”

The system enables users to turn a text chat into a one-way or two-way video chat with a dealer, including a screen share, enabling both parties to build and price a purchase, complete forms and submit financing requests. The chat can be transferred to a phone, allowing dealers to walk a customer remotely around the showroom or lot, exploring vehicles and facilitating questions on features and specifications. Tech company Rapid RTC of Winnipeg, Manitoba, developed the system, which president and CEO Glen Demetrioff says provides access to trained sales experts best “qualified to answer shoppers’ product- and pricing-related questions.”

Upon being given permission by the Ontario government to reopen dealerships in May, extensive physical-distancing guidance with advice on utilizing online techniques has been provided by the province’s Trillium Automobile Dealers Assn. (TADA) in cooperation with the Canadian Automobile Dealers Assn. That includes advice that dealers be able to fully demonstrate a vehicle’s features virtually through online video, FaceTime or other internet services.

Also, digital records must be kept of each vehicle presented to customers physically, including the name, contact information, date of interaction, and name of sales representatives, in case an outbreak of COVID-19 requires health officials to trace a motorist or any potentially infected dealership associates.

TADA President Cliff Lafreniere tells Wards a key change has been the authorization from April of e-signatures to mandate vehicle-purchase closing documents in Ontario, whereas physical signatures were required previously. When physical dealerships were closed initially, “we had to courier documents over to someone’s home for signature, and then courier them back,” so the new electronic system has been a boon during the pandemic. “That’s something we will use going forward,” LaFreniere says.

However, regulations on whether e-signatures are legal for closing auto purchase deals vary across Canada. Such rules cover professional systems such as those operated by online service DocuSign, for instance. They remain officially illegal in Québec, for instance, although its government has temporarily allowed online-only purchasing during the pandemic.

Another service developed during the COVID-19 era that probably will continue is remote delivery of vehicles to homes after paperwork has been completed.

Lafreniere, dealer principal at Pinewood Park Motors, a Ford dealership in Kirkland Lake in rural northeastern Ontario, says, “We have clients who live 45 or 30 minutes’ drive away – we can deliver to them.”

While data comparing online auto sales with those involving physical dealership visits is not available, these innovations likely have helped Canadian auto sales recover or, as market researcher DesRosiers Automotive Consultants characterizes it, “climb out of the abyss.”

June sales of new light vehicles in Canada were down 16.2% year-on-year, “a paltry performance under normal circumstances but a significant improvement compared to the 74.6% decrease in April and 44% decrease in May,” DesRosiers Automotive Consultants says.

“June undoubtedly saw the release of some pent-up demand into the market as blinking consumers took their first tentative steps out of their darkened lock-down basements and back onto the sun-kissed roads and highways.”