A Melbourne mother of four has launched a website called DutchAuctionAuto.com.au, where car dealers compete for sales by offering prospective buyers their lowest possible price.
Shoshi Vorchheimer, a former English teacher, decided to try her hand at business after having a bad experience with pushy car dealers.
“[I thought,] wouldn’t it be great if I could buy a car without the dealer ever having to know who I was?” she says.
Vorchheimer promptly set up Dutch Auction Auto, which aims to shift the balance in favour of the buyer. According to Vorchheimer, the website is the first of its kind in Australia.
The website asks buyers to post the maximum price they’re prepared to pay for a new car. Dealers then compete for the sale by offering their lowest possible price.
Vorchheimer says Dutch Auction Auto is a safe way to negotiate the price of a new car because buyers remain anonymous to avoid getting ripped off.
“The dealer doesn’t know if you’re a man or a woman, old or young. For the first time, this website takes age and gender out of the negotiation process,” she says.
“While car buyers are always looking for the best price, many may not have the time or skills to successfully negotiate price with a car salesman.
“With Dutch Auction Auto, consumers set the price and ensure they are getting the best value.
“Buyers who register their intention to buy a particular vehicle indicate the maximum price they are willing to pay. They also list any extras they want – everything from paint colour to rim size.
“The sale is then open to licensed car dealers from all over Australia who can bid for the sale by offering their lowest possible price.”
Vorchheimer says it doesn’t matter whether the buyer is around the corner, across town or interstate.
“All the dealer has to do is match or better the specified maximum price at the close of the 72-hour auction and make the deal,” she says.
“The seller then has to deliver the car within a set period, usually four weeks.”
The site is free to register, but buyers are required to put down a $1,100 deposit in order to purchase a car. If unsuccessful, the buyer’s deposit is refunded. Fees are only paid by the dealer when the sale is successful.
According to Vorchheimer, there has been an “overwhelming” response from dealers nationwide.
“While this website is going to be good news for buyers, it’s also great news for dealers who can help close sales in a tough market,” she says.
“The Australian automotive market is becoming increasingly competitive so dealers need to find new ways to reduce their overheads while accessing new sales leads.
“Dutch Auction Auto is equivalent to opening a dealership in another state, without the costs. By increasing sale volume at no extra cost, dealers can effectively lower their prices.”