GM to Sell Cars on eBay? Good Luck With That.

(MoneyWatch)  General Motors thinks it can sell cars online in California, through a new partnership with eBay. The plan is to offer them for both competitive bids and at set prices.

Good luck with that.

The record on selling cars online is not great. As reported here in January, although a J.D. Power and Associates report says 75 percent of new vehicle buyers use the Internet to shop (up from 70 percent in 2007), only 10,000 people a year actually buy a car that way without first visiting a dealership and "kicking the tires."

The usual method is to research a car's attributes online, then go to the nearest dealership to actually see it in the metal. eBay Motors is an established business for used cars, of course, and the company's stock went up 1.31 percent on the GM announcement (or at least congruent with it).

"We're testing this and other ideas with our dealers over the next few months, and hope to expand and build upon them in the coming months," said GM CEO Fritz Henderson. "Experiments are experiments--You don't roll them out until you figure out how they work. We are excited about it, but I wouldn't commit to rolling it out more broadly until we find out if it's successful."

It's hard to escape the conclusion that GM just wants to look "hip" with deals like this. What will really count, going forward, is putting cars in the showrooms that people actually want to buy. If the cars are great, they can sell them with smoke signals.

Photo: Flickr/Davezilla