Young Internet executive wants to buy dealerships

A 22-year-old founder and president of an on-line referral service wants to buy dealerships. Brian Stafford of carOrder.com, based in Austin, TX, plans to bankroll those planned initial dealership purchases with $100 million from parent software firm Trilogy Inc.

Trilogy plans an initial public stock offering by early 2000 to fund a second-round of dealership purchases, says Mr. Stafford, a Los Angeles native who previously worked for the privately held software firm.

Mr. Stafford hopes to sign up a financing partner in time for announcements of dealership purchases.

His firm also is seeking experienced auto industry executives to join the organization, which currently has about 100 employees in its Austin headquarters.

State franchise laws are a possible impediment to carOrder.com buying dealerships. There's also a question of whether automakers would be willing to give a dealership franchise to an Internet company. carOrder.com currently works with nearly 500 dealer partners who receive approved vehicle orders.

Mr. Stafford wants to acquire the first dealerships in mar-kets where a large part of the pop-ulation uses the Internet. He expects to set up five hubs.

One of those is expected to be in northern California, where carOrder.com partners include Dublin Honda, Dublin; Magnussen's Lexus, Fremont; and Rector Motor Car Co., an Audi-Olds-Porsche dealer in Burlingame.

To get out of the gate fast with what Mr. Stafford says is "a vehicle sales solution different from any other on-line car buying service," carOrder.com charges no sign-up fees for dealer partners nor purchase fees to car buyers or lessors.

A $500 deposit on credit cards is requested as a condition for arranging transactions. "It's fully refundable," if deals don't materialize, says Mr. Stafford.

Customers are encouraged to visit carOrder dealership partners, but all deliveries will be at home in an effort to provide 100% customer satisfaction.

If the plan goes through to buy dealerships, the stores will employ salaried sales staffers using a no-haggle one-price approach, says Mr. Stafford.

Only one model of every product will be stocked for test drives, with sold vehicles delivered to consumers on flat-bed trucks.

Unsurprisingly, much of the sales process will be done on the Internet.

Analyst James Hossack of AutoPacific expresses doubt that carOrder will easily gain factory approval for running dealerships.

"They'll want to make sure that staff is well-trained, with adequate parts and with knowledgeable sales persons," says Mr. Hossack. "Consumers will want to be assured they can get repairs as needed. It is an interesting idea, but not well-proven."