Groupon Offers First Voucher for Car Dealership

$199 Will Get You $500 Worth of a Buick, GMC or Cadillac

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Groupon is doing its first auto dealership deal in the country today at LaFontaine Buick GMC Cadillac in Highland Township, Mich., according to Automotive News.

Robert Milner, general sales manager at the dealership, said he was a little reluctant to be the first dealer in the country to try the Groupon deal but likes the idea of setting a precedent.

"We're dipping a toe in it," he said.

Consumers spend $199 for a voucher worth $500 toward the purchase of a car, redeemable this year.

Between giving up $300 to consumers and $100 to Groupon, each sale will cost the dealership $400.

Unsure of what the demand will be, LaFontaine capped the deal at 150 vouchers, Mr. Milner said.

"But if I get 150 people and it costs $400 per commitment, I'm all in on that ," he said.

Mr. Milner said the typical advertising expense per car is $350 to $400, putting the Groupon cost in line with budgeted expenses.

In a statement Groupon issued through its Chicago-based public relations firm SS PR, the company said car dealerships are a next step for the company.

"Since the beginning, Groupon's goal was to give service and structure out of the norm to local businesses and so that the local users would be able to shop with a discount," the statement said. "Groupon started with local businesses and went to spas and hotels and thought the next step would be to go to a car dealership."

With the deal running for the rest of today and into Wednesday, Mr. Milner said it's too early to say whether the strategy will work. If the deal goes well, he said, he'll consider proposing it for other dealerships within the 14-franchise LaFontaine Automotive Group.

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Daniel Duggan is a reporter for Automotive News.

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