Despite significant investment in digital platforms, the automotive industry is finding that consumers are largely resisting a complete shift to online car buying. While many initially express interest in the convenience of a fully digital transaction, the vast majority still prefer the traditional in-person experience.

Cox Automotive data released this month revealed a significant drop-off in online car buying completion rates. Initially, 28 percent of car buyers expressed a desire to complete the entire purchase online. However, only 7 percent actually followed through. This indicates a substantial disconnect between initial interest and final purchasing behavior. More than half of all car purchases are still conducted entirely in person, highlighting the continued dominance of traditional dealerships. An additional survey from the fall indicated that just over half of car buyers preferred to physically sign paper documents, further underscoring the reluctance to fully embrace digital processes. A December survey showed that 86% of buyers still want to physically inspect the vehicle.

This resistance to online-only car buying has significant implications for automotive manufacturers, dealerships, and technology providers. Companies that have invested heavily in building out online sales platforms may need to re-evaluate their strategies and consider a more hybrid approach that blends digital tools with the in-person experience. The data suggests that consumers still value the ability to physically inspect, test drive, and negotiate the purchase of a vehicle, which ranks second only to housing as the most expensive purchase most consumers make.

Cox Automotive, a research firm and provider of digital auto sales products, offers tools that allow dealers to initiate transactions online. Their insights into buying patterns, derived from both research and their product offerings, provide valuable context for understanding the current market dynamics. Erin Lomax, Vice President of Consumer Marketing at Cox Automotive, emphasized the importance of the tactile experience, stating that people want to see, feel, and touch the car before committing to a purchase.

Looking ahead, the automotive industry will likely see a continued evolution towards a more integrated online-offline model. While fully online transactions may remain a niche market, digital tools will likely play an increasingly important role in the research, financing, and pre-purchase stages of the car buying process. The challenge for automakers and dealerships will be to find the right balance between digital convenience and the personalized, hands-on experience that many consumers still demand.