Would You Buy a Car from Amazon?

Amazon sells possibly the widest range of products of any consumer retailer anywhere. Between its own inventory and what third parties sell, it truly has become The Everything Store.

But, will people buy cars at Amazon.com? Amazon recently announced a partnership with Hyundai to do just that. Simultaneously, Hyundai also made a commitment to Amazon Web Services and to integrating Alexa voice assistant technology into their cars.

For comparison, Costco seems to have built a meaningful car selling business, in partnership with thousands of local dealers, where transactions are consummated. We have our doubts that Amazon will sell many cars, however. We looked at consumer purchasing patterns for customers that shopped at Amazon in the past year, specifically at the most expensive item they ever bought at Amazon.

About 11% of customers in the past year report ever spending $1,000 or more on a single item. This includes purchases at any time in the past, not just in the past year. Electronics dominates large purchases, with over half of customers reporting computers, smartphones, and similar products as their most expensive purchase (Chart 1).