Beyond the automotive vending machine hype

Media attention on giant automotive vending machines, which brought skepticism over its practicality, ignored the benefits.

So says Seeking Alpha in its comments on a Ford and Chinese e-commerce company Alibaba partnership outlined last week to sell Ford’s electric vehicles.

It says the benefits of the vertical showroom (reduced land cost) and automated dispatching (wages elimination) translating into higher margins are being neglected.

The marketing prowess of Alibaba’s Taobao app features and financing options offered by Ant Financial have also been glossed over, Seeking Alpha

reports.

“Investors in the two companies would be pleased to note that there are longer-term collaborative synergies too.”

The multi-storey vending machine will be powered by China’s largest open business-to-consumer platform, Tmall, operated by Alibaba.

The arrangement would appear logical and advantageous, Seeking Alpha says. “Investors need to look beyond the hype created that focuses on the auto vending machine.”

The vending machines with cat inspired images are expected to open in dozens of centres across China next year, beginning in Nanjing and Shanghai in January.

Customers will scan an EV they’re interested in using the Taobao shopping app developed by Alibaba. They can select a colour, enter some basic information and take a selfie to identify themselves when they go to the unmanned vending machine.

The customer is matched with their order using facial recognition technology and the EV is retrieved from storage.

They have three days to test the vehicle before deciding whether to buy it, using the smartphone app to pay for it, or arrange to return the car and schedule another test drive.

Customers are limited to five test periods every two months to ensure the system isn’t used as a free car hire service.

They also need to qualify as an Alibaba Super Member, and have reached a certain level on the company’s credit scoring service.