Hopes to Drive Sales

Calling it the first true Internet car company, idealab subsidiary made its online debut
Monday, offering Netizens an online resource with which to research,
price, select, finance, order and take delivery of new vehicles.

CarsDirect differs from and similar sites because the entire process is done online. Autobytel and similar sites function as referral services and much of the process is still done by conventional dealerships.

The site offers buyers
online comparison shopping, and real-time, competitive price quotes through
a fixed-price quote configurator, adding option prices to the base price.
Customers can build their vehicle through review information and
add model and delivery options to their orders. Users of the site are not
limited to specific brands from manufacturers or dealers, and can chose
from more than 2,500 makes and models.

“Give us 15 Internet minutes, we’ll get you a great new
car,” said Scott Painter, CEO, “We’ll compare that Accord
and Camry, price it with or without leather or other options, get you a
great price, get you the exact financing and even the insurance you want,
and deliver it to your doorstep in two days. That’s what we mean by buying
cars direct.”

“We eliminate the confusion and
illusion of car pricing — we tell you exactly what you’ll pay, and tap the
Internet to squeeze out the
overhead. Our huge nationwide sales volume means rock-bottom pricing and
great after-sale service for buyers.”

Other features of the site include e-mail service reminders, online car
repair histories, monitored
discussion groups and announcements of new car-related products.

The country’s fifth largest bank, Bank One, is in partnership with, and will provide loan
and leasing financing for the online buyers. The bank is also helping establish its nationwide network of preferred auto dealers
to supply and service the vehicles. investment partners include Goldman Sachs, MSD Capital L.P.,
Foundation Capital, idealab Capital Partners, the venture capital affiliate of
idealab; and Primedia Ventures, a
subsidiary of publisher Primedia. The company has also formed a strategic
relationship with market researcher J.D. Power & Associates.

In partnership with credit union auto buyer Autoland, will
be able to find or source cars across the country.

Sherman Oaks, Calif.-based will retain offices in nine U.S.
markets, including New York, Los Angeles, Chicago, San Francisco, Seattle,
Miami, Atlanta, Denver and
Washington, D.C. The company said it is planning an aggressive rollout
strategy and will include over 40 cities by the end of the calendar year. was conceived by entrepreneur Scott Painter and Bill Gross
of idealab, the Pasadena, Calif. incubator which boasts over 20 successful
online companies in its portfolio, including eToys, Ticketmaster,
CitySearch, Free-PC and GoTo. Gross said he thought of the car-buying
service after becoming frustrated with buying a car online.

“ was born from my own experience, which clearly proved that
despite its fabulous utility,
the Internet was still a place where you couldn’t purchase one of America’s
most important commodities –
a new car,” Gross said. “I decided it was time to change that and is how we’re going to
make it happen.”

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