Beginning in 2024, e-commerce giant Amazon (NASDAQ:AMZN) will allow auto dealers to sell cars on its platform, starting with South Korean company Hyundai Motor’s (HYMLF) models. The news dragged down shares of car dealers Carmax (NYSE:KMX), Carvana (NYSE:CVNA), and AutoNation (NYSE:AN) by 5.6%, 5.3%, and 6%, respectively, on Thursday.
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Amazon Brings Hyundai Cars to Customers
Under a strategic partnership with Hyundai, Amazon’s customers will be able to purchase the automaker’s cars and opt to pick them up or have them delivered by their local dealership.
Further, the two companies are strengthening their relationship, with Hyundai choosing Amazon Web Services (AWS) as its preferred cloud provider to accelerate its digital transition. Additionally, starting in 2025, Hyundai vehicles will have Amazon’s Alexa voice assistant.
It is worth noting that Hyundai first launched its digital showroom on Amazon in 2018. The company then built on this collaboration in October 2021 by launching its Evolve showroom on Amazon, allowing customers to discover the available vehicle models at participating dealers and commence the vehicle selection process directly on the e-commerce platform. With the latest agreement, customers can now complete their car purchases on Amazon.
Several automakers like Tesla (NASDAQ:TSLA) and Rivian (NASDAQ:RIVN) are directly reaching customers in certain U.S. states by offering options to buy their vehicles via online channels. Meanwhile, for Amazon, the latest agreement with Hyundai will expand its merchandise offerings further.
What is the Future Price of Amazon Stock?
Ahead of the key holiday season, Wall Street is highly bullish on Amazon stock, with a Strong Buy consensus rating based on 40 unanimous Buys. Despite macro pressures, the company delivered solid third-quarter results, driven by strong momentum in its retail, cloud computing, and advertising businesses. The average price target of $175.51 implies about 23% upside potential. Shares have risen 70% year-to-date.
