Sun, Jul 12, 2009 - Page 11 News List

GM plans to sell cars on eBay

IN THE MAKING The chief executive at GM said the leaner company was looking for an innovative partnership with eBay to allow consumers to bid on vehicles

AP AND AFP , NEW YORK AND DETROIT, MICHIGAN

As part of its turnaround plan, General Motors Corp said on Friday it would experiment with auctioning new cars on eBay, expanding on an existing partnership covering certified used vehicles on the online marketplace.

GM chief executive officer Fritz Henderson said the company is working on an “innovative new partnership” with eBay Inc to let consumers in California bid on vehicles as they would in a normal eBay auction, or choose a “Buy it Now” option to purchase the car at a set price. Dealers would still distribute the cars.

A deal between eBay and GM hasn’t been completed yet, however, and both sides say they have been in discussions.

GM spokesman John McDonald said the company sees the sales of new cars on eBay as an experiment that builds upon the existing partnership in used vehicles. Certified pre-owned vehicles from GM, along with other carmakers, are offered for sale on eBay Motors, eBay’s online auto marketplace.

McDonald said GM is trying to get a deal done to start testing the new car sales on eBay in the “next couple of weeks.”

His remarks lacked the certainty Henderson used in a statement earlier Friday, where he said the company will start the sales and other ideas with car dealers in the next few weeks.

McDonald also said that some GM dealers already independently list vehicles on eBay and said this experiment could be a way to bring other GM dealers on board.

EBay Motors allows users to buy and sell new and used cars either locally or nationally. The site also offers motorcycles, boats and auto parts and accessories.

In a statement, eBay Motors vice president Rob Chesney said: “At this time, no plans have been finalized with General Motors.”

Chesney also said eBay was “excited about a potential new adventure that supports GM’s dealers by expanding on how they already reach consumers through new approaches.”

It remains to be seen how any such deal will ultimately play out for the ailing automaker and the online marketplace operator.

GM’s announcement comes as the company completed an unusually quick exit from bankruptcy protection on Friday with ambitions of making money and building cars people are eager to buy. Once the world’s largest and most powerful automaker, new GM is now leaner, cleansed of massive debt and burdensome contracts that would have sunk it without federal loans.

The automaker transferred its main assets to a new government-financed company under a plan supported by the administration of US President Barack Obama and the Canadian government.

“Today marks a new beginning for General Motors, one that will allow every employee, including me, to get back to the business of designing, building and selling great cars and trucks and serving the needs of our customers,” Henderson said.

The “new GM” will keep four key brands — Chevrolet, Cadillac, Buick and GMC — and will have a total of just 34 US nameplates by next year. Several brands owned by the old GM, including Saturn, Hummer, Opel and Pontiac, have been shed or are being sold.

The automaker also removing layers of management — reducing the number of US executives by 35 percent and overall US salaried employment by 20 percent by the end of this year.

Sean Maher at Moody’s ­Economy.com said GM “still faces a difficult year.”

“The company does not expect to turn a profit in 2009 and is unlikely to do so until US new vehicle sales rise substantially above their current depressed pace below 10 million per year,” he said.

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