Report: TrueCar Drew Hard Line With AutoNation Over Data

Aaron Cole
by Aaron Cole

Automotive News has interesting insight into the tenuous, and now soon-to-end, relationship between TrueCar and car dealer-giant AutoNation.

The report details a May lunch between TrueCar CEO Scott Painter, President John Krafcik and Senior Vice President of Dealer Development Mike Timmons, and AutoNation COO Bill Berman and Chief Marketing Officer Marc Cannon. At the lunch, TrueCar executives reportedly said they would require data from all AutoNation sales — regardless if they were generated by TrueCar — for the two companies to continue doing business.

“Over my dead body,” AutoNation CEO Mike Jackson said later, according to Automotive News.

Last week, when Jackson announced the split between AutoNation and TrueCar he laid most of the blame at TrueCar’s “unconscionable and unprecedented” demand for more than 40 data points for each car sold at AutoNation. AutoNation sells more than 550,000 annually at its 240 dealerships across the United States.

The dealer said roughly 3 percent of its sales can be attributed to TrueCar leads, which it charges $299 and $399 per new- and used-car purchase. AutoNation said it pays TrueCar around $550 per sale, for which TrueCar unjustifiably takes credit. TrueCar said internal auditing revealed that they were responsible for nearly 7 percent of AutoNation’s sales.

“We know exactly the degree to which AutoNation underreported,” Painter said. “It’s massive.”

“Customers go many places before and after a TrueCar visit, and just because they were momentarily on the TrueCar site doesn’t mean I should have to pay them $300. So there’s a big disagreement there,” Jackson said.

In a May 23 letter to Berman and Cannon, TrueCar specifically outlined the customer data it was seeking and said it was already “firing” dealers who failed to comply.

“In the trailing 12 months, TrueCar suspended over 300 dealers who did not meet marketplace or customer requirements. We are prepared to take similar action here should AutoNation elect not to follow our marketplace requirements,” the letter states.

TrueCar’s request for data included customer’s names, addresses, phone numbers and e-mail addresses in addition to data on the newly purchased car.

Dealers have said turning over such extensive data could lead to privacy concerns and enable TrueCar to steal customers in the future.

AutoNation said it would start up its own portal for customers similar to TrueCar, and would back away from third-party vendors in the future.

Aaron Cole
Aaron Cole

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  • Inside Looking Out Inside Looking Out on Jul 13, 2015

    You get what you pay for. If you do not want to haggle or spend days searching the car you use Costco, True Car or private negotiator. In all cases you spend around $300 extra compared the best deal you can get by doing it yourself. It is a convenience - the service - so it costs money. If you think your time and health does not cost money or you have fun dealing with dealers directly - then you do not need this service. Truecar aggregates dealers so you do not spend time negotiating with every dealer in your area. When buying last car I needed to do it within couple of hours since I was extremely busy with the new project with the approaching deadline. So I skipped human negotiator factor and went with Costco and Truecar. Within 2 hours I finalized the deal via Truecar - Costco had less dealers and Truecar dealer offered me the exact the car I wanted with price lower than both Costco price and Truecar recommended price, like $1000 less. I spent more time signing documents than finding car and finalizing price. One of Costco dealer were offering me exactly the same car (VIN number match) I bought later for $1000 more from Truecar dealer. It was not listed on their site but was listed on Truecar dealer site so he was going to bring it from the dealership I bought it from and add $1000 to price.

  • Ruggles Ruggles on Jul 28, 2015

    All you need to know about TrueCar is that their customers are NOT consumers, they are dealers. If they help dealers make money, they have a business. If they don't their customers, the dealers, give them the boot. In the meantime, consumers don't know or care what a dealer needs to make. They're not likely to understand it anyway. Anything that appears too good to be true, probably is.

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