All seemed well for TrueCar Inc. (NASDAQ: TRUE) as the company continued to execute on its turnaround plan and investors grew hopeful that success was within reach. The company’s 2Q2016 highlighted how its turnaround efforts are beginning to bear fruit given that topline and bottom-line figures outpaced forecast.
However, Amazon.com, Inc. (NASDAQ: AMZN)’s move to launch another vehicle oriented website has seemed to complicate the picture for TrueCar and its turnaround plan. Amazon has launched a new website called Amazon Vehicle, which like TrueCar, is designed to help people in their car purchase journey.
About Amazon’s rival site
You can consult Amazon Vehicle for information such as car specifications, images, reviews and general pricing such as what the manufacturers recommended price. These are services that TrueCar Inc (NASDAQ: TRUE) already offers customers on its website, which means that Amazon Vehicle is set to increase competition for TrueCar can in the business of helping people obtain information about vehicles they intend to purchase.
The only thing that TrueCar Inc. (NASDAQ: TRUE) does but Amazon isn’t getting into immediately is enabling people to buy a car on its website. But because this is Amazon, it could only be a matter of time before the company jumps into the business. It is for that reason that TrueCar should be worried about the launch of Amazon Vehicle.
Initially, Amazon said its Amazon Vehicle site will function as an extension of its other vehicle oriented platform called Amazon Automotive store. Millions of car items such as tires, tools and replacement parts are sold on Amazon Automotive store and it is a popular place for drivers looking for car accessories.
Other than TrueCar, Amazon’s Amazon Vehicle could increase competition for AutoTrader, Craigslist and Cars.com among others that are engaged in car selling business.
How TrueCar Inc. (NASDAQ: TRUE) fared in 2Q2016
TrueCar Inc. (NASDAQ: TRUE) posted EPS loss of $0.05 on revenue of $66.4 million in 2Q2016. Analysts were looking for EPS loss of $0.10 on revenue of $65.52 million in the quarter. Besides posting top and bottom line gains, TrueCar also said its dealer partners increased to a record of 12,669 in 2Q.