Back in 2002, RetailWire published a story on a survey by Accenture that said traditional car dealerships in Europe would see profits drop by as much as 40 percent by 2010 because new formats including supermarkets would get into the business of auto sales. That same year, RetailWire reported on Wal-Mart Stores leasing parking lot space for the purpose of selling used cars.
Back to the present, reports this week say Lidl, a discount supermarket chain based in Germany, has decided to sell a Volkswagen Cross Polo and Opel Corsa through its website at 25 percent below manufacturer suggested retail prices.
Lidl is working with the German car distributor ATG-Automobile GmbH, according to Petra Trabert, a spokesperson for the grocery chain.
"Lidl and ATG-Automobile GmbH work with the same target audience," Ms. Trabert told The Associated Press. "We are geared toward the customer who seeks quality in conjunction with a favorable price."
The German economy, like that in the U.S., is suffering from a recession with unemployment above eight percent. Ferdinand Dudenhoeffer, the director of the Center for Automotive Research, told the AP, "I think it will be very difficult for Lidl. People don't want to buy high-value products from a discount grocery store."
"Germans like to go to the dealership," he added.
Discussion Questions: Will we see retailers in the U.S. going into side categories such as Lidl has done with cars in an effort to drive incremental sales and profits? Do you see car sales, whether online or on lots, as an opportunity for retailers not currently in the auto dealer business?