Buying Platforms Looking into Selling Luxury Vehicles Online
China’s market for imported luxury vehicles sparked the emergence of a number of new online buying platforms this including UGcar a cross border website. The operation raised more than 10 million yuan using a Series-A financing that is led by Gobi Partners and Tianjin CaifuJiaji Investment Partnership. The founder Zhao Qing stated that the e-commerce is well embraced by Chinese customers but unlike small items that are selling in these online sites, the supply chain for online car selling is a bit challenging.
Also by trying the O2O or the Internet+ model looks a little easier to use, but actually might not survive theses models. With headquarters in Tianjin Binhai New Area, UGcar is two companies merged into one, the first is Tianjin Xinlinghang Information and Technology Company and the second is Tianjin UGcar Sales Company. The first company is the one responsible in running and the growth of the online car buying platform, while Tianjin UGcar deals with the actual trading of the automobiles. Unlike any other online car dealer the company is purely e-commerce, they don’t have stores but has own supply chain that offers transparent pricing and one stop servicing.
Same as the process of a US car comparison site True-Car.com, who purchases cars from UGcar saves a buyer 10,000 yuan or ten percent discount on forecourts, which is a result of a parallel importation of vehicles that placed it in direct conflict with authorized dealers. The company is also expanding into B2B. by engaging in parallel imports means introducing goods into a country outside their conventional sales network.
Although there is pressure felt from main dealers, the company is working hard in changing the purchasing habits of consumers, from buying online rather than buying in showrooms. Home delivery will be done soon in the future, but for the moment customers are preferring to try out the vehicles in the store first.