General Motors will launch its newest BuyPower site in Spain by the end of the month, making that country the 26th nation to have a GM consumer portal and keeping the auto giant on target to have its Web sites deployed in 40 countries by New Years Day.
GM has been the most aggressive automaker in its use of the Web to market vehicles directly to consumers. The company sees BuyPower as a low-cost sales channel that it can use to reach buyers — particularly in emerging markets.
With BuyPower installed in 40 countries, GM can reach "3.5 billion potential customers," at very low cost, said Ralph Szygenda, chief information officer of GM. All of the BuyPower sites use a common platform that coders in Detroit have developed over the past few months, he said. The platform relies on standardized database and vehicle configuration software, and all of the portals will eventually be based on Java 2 Enterprise Edition. In addition, all of the sites are hosted at a single GM data center in Raleigh, N.C., that is operated by IBM.
GM sees a big potential payoff in BuyPower, which cost tens of millions of dollars to develop. While thats a significant amount of money, when it is compared with GMs overall IT budget of more than $3 billion per year, the BuyPower effort is "a drop in the bucket. Yet it gives us the opportunity to go into those 40 countries and change our business processes," Szygenda said.
Allowing customers to order their cars directly from GM could help the company make better use of its manufacturing capacity, reduce its parts and vehicle inventories and, most important, give buyers the exact vehicles they want.
Over the next 10 years, the company expects about 60 percent of its vehicle sales growth to come from just eight emerging market countries: Brazil, China, India, Mexico, Poland, Russia, South Korea and Thailand. Of those countries, BuyPower is currently live in Brazil, China, Mexico and Poland.
GM is having notable success in Brazil, where consumers can access BuyPower directly over the Web or through kiosks in local dealerships. This year, the company has sold 60,000 cars in Brazil directly to consumers.
Although the BuyPower software platform is standard around the world, GM allows business units in the target countries to adapt the sites for their locales. That assures that language problems and other obstacles are avoided. Each country can also offer different financing options and allow users to compare GM vehicles to those offered by other car makers.
"BuyPower may have more success overseas than they will at home," said Travis Pascavis, a stock analyst at Morningstar. Pascavis said many consumer-focused auto sales sites in the U.S. have failed to live up to expectations. "If you look at how entrenched the auto dealers are in the U.S., they have a lot of influence and power over GM. They dont have as much power overseas," he said.