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CarsDirect.com Launches as the First Internet Car Company; New Web Site Enables Consumers Nationwide to Complete the Car Purchase Online, Take Delivery At Home.

LOS ANGELES--(BUSINESS WIRE)--May 17, 1999--

Idealab Company Places Car Buyer in the Driver's Seat,

Offers Low Prices, High Convenience --

and Puts the Fun Back in Car Shopping

Change is once again driving the auto industry.

The industry grew up in phases during this century: Henry Ford made cars affordable for the working man; Alfred P. Sloan brought car buyers variety; Japanese manufacturers made quality and dependability standard equipment.

Now, another major shift is upon us, as an Idealab company, CarsDirect.com -- brainchild of Internet guru Bill Gross and entrepreneur Scott Painter -- launches today at http//:www.carsdirect.com with a new way to buy cars for the next century.

The first Internet car company, CarsDirect.com is the only nationwide online source that enables consumers to research, price, select, finance, order and take delivery of a new vehicle, at home or the office.

CarsDirect.com gives a green light to Internet users who -- armed with access to complete and objective information -- have decided exactly what they want and are ready to make their vehicle purchase over the Web. Created as a straightforward alternative to the normally time-consuming car buying process, CarsDirect.com is a new model of consumer convenience, unlimited choice and simplified pricing.

"No other company, online or off, is committed to providing a more efficient and economical way to buy a car," said Scott Painter, CEO, CarsDirect.com. "Give us 15 Internet minutes, we'll get you a great new car. 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."

For Car Buying, A New Model

Now poised to make major inroads among the 80 million Americans online today, CarsDirect.com is dedicated to creating for buyers a consumer-friendly environment, offering online comparison shopping, real-time, competitive price quotes -- via a fixed-price quote configurator, which adds option prices to the base price as the customer "builds" the vehicle -- authoritative reviews of popular vehicle makes and models, and a range of direct delivery options including home or office.

"The car-buying experience has remained virtually unchanged since our grandparents bought their first cars - it's time for an overhaul that puts the consumer in control," Painter said. "We know how difficult car-buying can be. That's why we want to help in every way we can.

"We use the Internet to make car-buying fun," he added. "Hit the Net at 2 am in your pj's, shop with absolutely no pressure, capture a great price, and set up home delivery. 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 CarsDirect.com buyers."

Rather than being confined to the specific brands represented on a manufacturer's site or a dealer franchise, CarsDirect.com customers can choose from among more than 2,500 makes and models produced by every major manufacturer -- the first truly objective new car buying experience.

CarsDirect.com is more than just an online transition from the "brick-and-mortar" paradigm. As the first Internet car company, CarsDirect.com has changed the very focus of the transaction from car selling to car buying. In this next-generation environment -- with virtually no emphasis on promotion -- cars are not sold, they're bought.

Beyond Dealer Referrals

Unlike CarsDirect.com -- which enables buyers to complete the purchase transaction -- other auto Web sites only provide referrals, which are then submitted directly to a large network of dealers for a fee. From these sites, consumers and dealers still need to negotiate the final terms of the purchase.

"If Amazon.com merely referred you to a book store to buy your book you'd feel that they'd have come up short," Painter said. "That's what Internet car referral firms do. You get half a loaf -- only CarsDirect.com brings home the car."

CarsDirect.com understands that the car-buying process involves many steps beyond research and referral, and it is developing its business to help consumers complete each step more easily. In fact, Internet car-buyers can initiate the actual car purchase in as little as 20 minutes.

The focus is on providing car shoppers with the data and tools they need to consummate the transaction -- from information on the car itself to full financing, insurance, warranty and documentation support, and the creation of ongoing relationships with customers, through maintenance and service partnerships.

Other value-added features will include e-mail service reminders, online car repair histories, monitored discussion groups and a series of new car-related products designed to leverage both the interactive environment and CarsDirect.com's network of customer and partner relationships.

Leveraging Strategic Partnerships

Visionary leaders from inside and outside the auto services sector comprise the strategic partnership backing CarsDirect.com.

Bank One, the nation's fifth largest bank and a major automotive lender, is developing a partnership with CarsDirect.com to fulfill a vision of a comprehensive, one-stop car-buyers' site. Bank One will provide loan and leasing financing for the online buyers, and is also helping CarsDirect.com establish its nationwide network of preferred auto dealers to supply and service the vehicles.

CarsDirect.com has received significant investments from Goldman Sachs; MSD Capital L.P.; Foundation Capital; Idealab Capital Partners, the venture capital affiliate of Idealab; and Primedia Ventures, a subsidiary of Primedia, the nation's largest automotive publisher, which includes such brands as Automobile, Wards and Intellichoice -- a leader in supplying comprehensive pricing data to the auto industry and to CarsDirect.com. The company has also formed a strategic relationship with leading industry market researcher J.D. Power & Associates.

In addition, CarsDirect.com has received a jump start in its ability to source cars through its strategic partnership with Autoland, one of the nation's largest credit union auto buying services. During its beta site phase, CarsDirect.com served 600 customers representing more than $20 million in car sales.

Complementing its Web presence, CarsDirect.com will have at launch local offices in nine major U.S. markets, including New York, Los Angeles, Chicago, San Francisco, Seattle, Miami, Atlanta, Denver and Washington, D.C. Representatives in these offices will serve customers and local partners alike. The company is planning an aggressive rollout strategy that will include more than 40 cities by the end of the calendar year.

CarsDirect.com is staging the number of cars available at launch, as a means of ensuring a consistent and high level of customer service for its initial buyers. The company's launch coincides with the closeout of the 1999 model year.

CarsDirect.com was conceived by Painter and Bill Gross of Idealab, the Pasadena, Calif. incubator, with more than 20 successful online companies in its portfolio, including eToys, Ticketmaster, CitySearch, Free-PC and GoTo. After becoming frustrated with his own efforts at buying a car online, Gross realized current Internet options were not only inadequate but did nothing to leverage available technology on behalf of the car buyer.

"CarsDirect.com 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," said Gross. "I decided it was time to change that and CarsDirect.com is how we're going to make it happen."

About CarsDirect.com

CarsDirect.com (www.carsdirect.com) is a revolutionary new Internet company that enables consumers to buy a vehicle over the Internet. With CarsDirect.com, car shoppers can research, price, design, order and take delivery of a new car or truck right from their own computer -- selecting from among more than 2,500 makes and models produced by every major manufacturer. Unlike referral services, which simply point people in the direction of a dealer, CarsDirect.com customers complete the transaction online, with full financing, insurance, warranty and documentation support.

Based in Sherman Oaks, California, CarsDirect.com is an Idealab company, with investors that include Goldman Sachs, Foundation Capital, Idealab Capital Partners, MSD Capital L.P., and Primedia Ventures, among others.
COPYRIGHT 1999 Business Wire
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Copyright 1999, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Publication:Business Wire
Geographic Code:1USA
Date:May 17, 1999
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Previous Article:Idealab Company CarsDirect.com Launches as First Nationwide Online Source for Car Purchase, Home Delivery.
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