Ford Motor Co. signed a letter of intent Thursday with the world's largest retailer - Chinese e-commerce company Alibaba Group - which will allow the companies to explore new ways to purchase and finance vehicles in a fast-growing market.
Alibaba spokeswoman Crystal Liu declined to comment, according to South China Morning Post (SCMP).
And while Ford benefits from Alibaba's retail and digital experience, Alibaba can pull from Ford's experience running a global company as the Chinese company tries to expand.
The source said the tie-up could mean that cars purchased online are delivered to buyers by franchised Ford retail stores and would be maintained and repaired by them.
Earlier this year, Alibaba's retail arm Tmall announced the development of a vehicle vending machine, in which consumers can use their phone to browse through cars stored in a tall windowed building and have the auto brought down to street level via elevator lifts.
Hackett added that Ford's goal is to become the most trusted mobility firm of the world, designing smart cars for a smart world.
According to Alibaba, consumers can use their phones to browse through the cars garaged in the store and choose to either immediately buy one or test drive it. The chosen vehicle would be delivered to the ground floor.
The model allows shoppers with good credit to purchase their new ride with a 10 per cent down payment and then make monthly payments for the vehicle purchase through Alibaba's affiliate Alipay, according to Alibaba.
"When online sales and direct sales volume was small that is one thing". But if this format gained steam, it would definitely impact dealers. "Retail innovation is great, but it is by its nature disruptive and can't keep everybody happy". However, Alibaba gets both the financing and the sales.
The Alibaba partnership is the latest in a series of partnerships and initiatives in recent months in which Ford amplifies its presence in China.
The source said Ford is "behind in using big data" to monitor sales trends and effectively market its cars and the move to online sales as well as the access to Tmall's massive database of information on consumers would help it to catch up. Getting a test drive via the internet could change that, though.
China is the world's largest auto market, with about 23 million vehicles sold in the first 10 months of the year.