THE VIRTUAL TEST DRIVE

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Haggling for a car has gone digital, as shoppers around the globe begin to use the Internet to help them shop for their next automobile. Already, 36 percent of American Internet surfers say they have visited auto-related Web sites and 65 percent say they plan to do so within the next 12 months, according to "Cars Online 2000," a survey by Cap Gemini Ernst & Young.

In some cases, interest in auto sites is even greater outside U.S. borders. Fifty-six percent of Internet users in Sweden, 48 percent in Germany, and 46 percent in Holland report having logged on to car sites, according to the study. However, auto sites were slightly less popular in the United Kingdom and France, where 30 percent of Internet surfers in each country visited such sites, and in Italy, where 32 percent did so.

But this doesn't necessarily spell doom for the local car dealership. Across the globe, less than 1 percent of Internet users have actually purchased a car online. In the U.S., that number is slightly higher - 1.6 percent have bought their wheels on the Web, and 5 percent say they would consider doing so in the future.

Today's car shoppers are more inclined to buy their car in person, where they can kick the tires. Negative stereotypes of car salesmen aside, consumers have high opinions of car dealerships, especially in the U.S. and U.K., where 94 percent of survey participants in each country say they are satisfied with manufacturer-appointed auto dealers.

"Dealers are not going anywhere," says John Jordan, principal at Ernst & Young's Center for Business Innovation. "You still can't get your oil changed online. But the Internet can be used to make a happier car-owning experience." For instance, he says, the Internet can help car owners schedule and remember those oil-change appointments.

But, at least for now, prospective car buyers are using the Internet mainly to comparison shop. Through their computers, car buyers have access to the independent evaluation of cars and option packages posted by reviewers and other car owners. So even though most shoppers aren't consummating their car deals online yet, they seem to be narrowing down their purchase decisions there. The information gathered online may in fact push potential consumers toward, or steer them away from, buying a certain model or type of car, says Jordan: "If I'm Ford, I sure want to know about that."

For more information, contact Cap Gemini Ernst & Young at (212) 944-6464.

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