Nationwide Bank partners with TrueCar for "Single Stop"

[Jeff Kershner]

Nationwide Bank announced a partnership with TrueCars to provide a service that is designed to provide consumers with a "single stop" for their next vehicle purchase.

The service is to allow customers to find a vehicle, secure its price, get a loan and acquire auto insurance - ALL WITH ONE STOP

They've even coined it as Car Buying Reinvented !!

In a poll of 1,000 car buyers, Nationwide found that 25 percent thought car buying was as stressful as preparing their taxes. The highest stressors were negotiating price and obtaining financing, and 62 percent of respondents said they believed the dealership wasn’t going to give them the best price.

Through Nationwide’s partnership with TrueCar, an online car-buying service that allows users to compare dealerships’ prices and lock in the best deal, customers can search for cars at dealerships in their area. Once you find a car at the price you want, you can explore financing options with tools that show you what your monthly payment would be based on the loan’s term and the amount of your down payment, until you reach a loan agreement. Read even more here..

Could this be a growing trend with Banks and Financial Services?

 

[Chris Leslie]

I believe we will see more and more of these kinds of partnerships in the coming future.
They need to be able to offer additional services to their portfolio and I am sure that the USAA / Trucar partnership has been profitable on all sides.

As the tech continues to grow outside of dealerships. Large companies are looking for these opportunities to be part of the automotive space that allows them to maintain control and get an inside edge that they cant get at a dealership level.

 

[craigh]

Nationwide found that 25 percent thought car buying was as stressful as preparing their taxes.

What a bogative statistic. What percentage of people get stressed about their taxes? What percentage of people would be less stressed if the process was online, with no human contact to trust?

I like everything else about the idea, but that statistic is a poor argument for why we want/need this change.

 

[craigh]

Here's their infographic:
http://www.nationwide.com/car-buying-infographic.jsp

 

[yagoparamo]

Does this pass the F&I liabilities from the dealer to the bank?

 

[Chris Cachor]

The service is to allow customers to find a vehicle, secure its price, get a loan and acquire auto insurance - ALL WITH ONE STOP

Are dealers comfortable with this? IMO, it's the first step in outsourcing your sales floor to third parties like TrueCar.

Is this a system dealers would want to buy? I know Shop, Click, Drive failed - but in my opinion for very different reasons. If this gains traction and I'm a dealer I'd be doing everything I could to build my own web property and not let someone like TrueCar slowly begin using leverage against my business!

 

[joe.pistell]

Here's their infographic:
http://www.nationwide.com/car-buying-infographic.jsp

My instincts tell me that the survey & infographic was created by TrueCar. All it does is talk about the urban legend (car dealers are evil). It does not deliver a solution that is superior to the car dealer shopping experience.

Yet another evil dealer #Fail.

 

[joe.pistell]

TrueCar's business model requires them to aggressively spend cash until they hit an inflection point where it flips to a profitable operation.

Revenue is growing nicely...

But TrueCar hasn't made a profit yet, & it's losses are trending lower (all that TV spending)



TrueCars issues more shares to fund TV spending...

How long will investors hang on for this?

Many high growth companies like Amazon have this model. Wall Street's investors judgement on TrueCar's future is seen in it's stock price. Although TrueCar's stock price is slightly above it's IPO, it's well below the market overall.

Compare investing $1000 in AutoByTel vs TrueCar this year:

• AutoByTel = $1460
• TrueCar = $520

Is TrueCar running out of runway needed for it to take off?
What is the catalyst that TrueCar needs for it to hit critical mass?

 

[Jeff Kershner]

In my original post I ended with a question..."Could this be a growing trend with Banks and Financial Services?"

And within a little over a week I get this email from my BANK - M&T Bank. Which is no small bank here on the East Coast from PA to NC.

 

[joe.pistell]

IMO, TrueCar's biz model has a loud bark, but a weak bite. it's built on one 'user story': "I know the exact yr/make/model/trim and a price comparison service will help me decide which dealership to visit".

Price comparison services have been around for years and haven't made a dent in our space.


My instincts tell me that the moment TrueCar pulls it's TV ad spending, it's traffic falls dramatically.