Walmart To Begin Selling Cars? Not Exactly

walmart store

There have been a lot of headlines this week about Walmart getting into the car business, but not so fast.  You need to understand the arrangement.  The Arkansas-based retailer won’t stock cars, will not be able to use their buying power to save consumers money, and they sure won’t be there for you should you have a service problem.

Walmart has partnered with a company called CarSaver.  CarSaver’s digital platform allows car shoppers to select, finance and insure a vehicle through its website or on a touch-screen kiosk, backed by bilingual auto advisers available by phone. Staffers at CarSaver Centers — set up inside Walmart stores across from checkout lanes and alongside other services, such as vision centers and nail salons — will explain the car-buying program to Walmart customers.

Customers will be able to select a new, used or certified pre-owned vehicle and apply for financing and auto insurance on the kiosk at the CarSaver Center, on their mobile device via CarSaver’s website or by calling an 800 number.

CarSaver then will connect customers with a local dealer and schedule an appointment to visit the dealership. If a shopper doesn’t contact the dealership, an auto adviser reconnects with that shopper.

So essentially, Walmart and CarSaver are brokers.  The dealership will pay CarSaver a $350 fee and presumably Walmart will get a cut of that.  The question is, can a consumer get a great deal with middlemen involved like brokers or third party lease companies?  In my opinion, not as good a deal as they can get on their own.  The $350 fee these two companies get will be passed right on to the consumer.

Will it make the process of buying a car easier?  Probably not. The buyer will still have to go to the dealership, go through the financing process, negotiate the trade-in value if applicable, etc.

In summary, is Walmart selling cars?  No – they are selling leads to dealerships, along with all your personal information.

Photo Credit:  Wikimedia Commons

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