Consumer Reports Study Questioned
The study had 1,056 online shoppers request price quotes for six types of vehicles at five automobile shopping sites. The research stipulated two requirements for each price request: Dealers had to be within 100 miles of the shopper and they must deliver a quote by phone or e-mail within two business days.
The study, published Monday, found that only 35 percent of the panel members received a price quote within 48 hours of making their online request. In many cases the quote was not for the exact car specified. Some cars were the wrong color while others included unwanted options such as a sunroof or leather seats. Twenty-two percent of shoppers were not allowed to buy online as they were told they had to visit a dealership to get a firm price.
The five sites reviewed for the survey were AutoBytel.com, AutoVantage, AutoWeb, Cars.com and CarPoint.
"This is a poor showing considering we chose standard model vehicles from well established dealership networks, mostly in large metropolitan areas," said Lou Richman, finance editor of Consumer Reports, Yonkers, NY. "The fact is the quotes were not available for more than half the cases. This is a severe limitation on the usefulness of these sites."
These findings have at least one site claiming this study is a conflict of interest as Consumer Reports recently launched its "New Car Price Service," which directly competes with the online auto sites' services.
"For Consumer Reports, who is certainly a highly respected group, to report on toasters is different from them reporting on a service they also offer," said Ann Delligatta, COO for Autobytel.com, Irvine, CA.
In response to the survey, Autobytel.com issued this statement: "Consumer Reports, while a valued and respected consumer information source, is using this study to help launch a Web-based service providing pricing information for $12 per vehicle. This information (dealer invoice, rebates, specs, comparative reviews) has been free at Autobytel.com for five years."
"There's no hidden agenda here, [the car pricing service] was disclosed in the article and through the issue," Richman said. "We are not evaluating rivals. We don't do what they do. We don't contact a dealer to sell you a car."
The Consumer Reports pricing service gives consumers a "basis in which negotiations can start," according to Richman. "They are equipped with relevant information other than what you'd get on a car sticker or on a Web site where you don't know how fresh the information is."
Although Autobytel.com questioned the motive behind the report, it did not dispute the fact that there are indeed problems with the online car sites.
"We're trying to change an industry," said Delligatta. "When you're managing this number of dealers, it does present challenges."
She added that dealers are given a report card based on their response to online consumers. If they fail to respond to online queries, they are put on "alert."
Autobytel.com claims the survey did not negatively affect car sales and that the site sells 40,000 to 50,000 cars online monthly.
Consumer Reports used a third-party research firm to conduct the study.