2 COMPANIES BANK ON ON-LINE PARTS

While the industry debates whether automobiles can be bought on line, two companies are banking that auto parts can and will be purchased via the Internet.

CarStation.com and Parts.com both are recruiting dealerships with wholesale parts operations to offer their wares to other dealerships and independent repair shops. That's done with websites and software.

CarStation was founded in 1998 and thus far has attracted 1,500 franchised dealers to participate in their programs, which are designed to benefit dealers, independent repair shops, insurance companies and consumers.

"Our model is a hub that brings together the insurance companies, the repair shops and the suppliers," says Ronald E. Goldsberry, the former Ford Motor Co. Customer Service Division vice president. He joined CarStation as chairman and CEO in October of 1999.

Among services the firm provides is the CarStation Marketplace, which allows repair professionals to buy wholesale parts from dealerships 24 hours a day, 7 days a week.

Shop personnel can search the CarStation web site by price, location or quality of part. CarStation offers OEM, recycled, reconditioned and aftermarket parts on its website.

Mr. Goldsberry says the CarStation Internet solution for dealership wholesale parts businesses - called CarStation Advantage - makes these parts transactions faster and more efficient, which makes consumers happy. It helps dealers increase their market share and makes them more profitable.

"Essentially, we serve as a sales force for those dealers," says Mr. Goldsberry. "We also provide information to dealers to help them understand who the repair shops are and what they need."

While dealers might not be too concerned about the customer satisfaction index of local repair shops, insurance companies are. Many of them are wired into CarStation.

The company's Insurance Service Center provides insurance professionals with tools to improve customer service. These tools include a repair shop locator and a reporting service to track preferred shop activity.

Also in the insurance site is a place to help schedule customer vehicle repairs and a site to review customer CSI ratings on selected repair shops, as well as an administrative tool to manage preferred shop data and register company site users.

Consumers themselves can use CarStation to find body shops, technicians and service centers, and get tips on what to do following an accident.

A search for body shops in a randomly selected area turned up 10 area body shops - five were associated with franchised dealers.

CarStation also offers Internet site management for independent repair shops.

"We're above plan, so it's going well," reports Mr. Goldsberry, who outlines the next product his company is rolling out - an automated procurement system for independent repair shops that integrates Internet ordering from dealers with its actual work flow.

"This system replaces the analog way of procuring parts - via the telephone and fax machines - with a digital system," says Mr. Goldsberry. "The next step is integrating the system into the dealership management system so the dealer's parts inventory is on line."

CarStation will collect its fees for this service based on the amount of parts sold through the process. The company collects subscription fees for its other offerings.

While CarStation is attempting to improve customer satisfaction and the entire vehicle repair/insurance claim process, Parts.com is focusing on streamlining the parts-purchasing process.

Parts.com, which was launched in January, wants its suppliers (dealers) to build the infrastructure needed for parts delivery within hours - or even minutes - of order placement.

As of April, the company has recruited some 155 suppliers, many of whom are the biggest wholesale distributors in the country. They include several dealership groups such as AutoNation USA, Hendrick Automotive Group, Lustine Chevrolet and the Bill Heard Group.

"Automotive dealerships across the country are embracing our model because it represents the future of the auto parts industry," says Shawn D. Lucas, chairman, president and co-CEO of parts.com.

He adds, "Parts.com has a superior business model and - just as important - a live, operational B2B2C (business-to-business-to-consumer) exchange."