St George Sinks $5m Into Car Site
Sydney Morning Herald
Friday December 3, 1999
St George Bank has formed a joint venture with US motoring portal Autobytel.com, a move which will offer Australian consumers another fully-fledged automotive site.
The bank has invested about $5 million in the venture which will sell new and used cars as well as finance and insurance products.
The Web site, which will compete directly with ninemsn's Carpoint and Fairfax's Drive, will be operational within six months.
St George is negotiating with other financial services firms to take an equity position in the joint venture.
``There may be another financier on the site. In fact, we see that as crucial to the site," said St George general manager, joint ventures and commercial finance, Mr Tim Miles.
``If St George was the exclusive financier on the site, we wouldn't be giving consumers a choice and they wouldn't shop at the site."
Mr Miles said St George, which has a $1 billion auto finance book, was predicting the site would account for 20 per cent of secured car loans by 2004.
``The site acts as an information provider to consumers. If they are looking for a new car it will provide all their information. In that respect, it's quite similar to [Fairfax's] Drive site.
``The site then directs consumers to Autobytel franchised dealers. The model has a limited number of dealers because that allows us to add value to the dealerships."
Autobytel.com operates in the US, Japan, Canada, Britain and Sweden. It accounts for 45 per cent of online new vehicle purchases in the US.
Autobytel.com vice-president Mr Josh McCarter said the site would seek relationships mainly with dealers but it would also have some relationships with manufacturers.
The joint venture comes just two months after Yellow Pages entered the online motoring market with a site called Yellow Pages Online Automotive. That site also follows a similar format to Carpoint and Drive.
© 1999 Sydney Morning Herald