Alibaba Launches Giant Car Vending Machines In China

Shares of Alibaba fell on Thursday morning, despite an exciting news story involving the Chinese e-commerce juggernaut, which is rushing to shake up the way people buy cars in China. Alibaba seems to be taking a page from Amazon’s acquisition of Whole Foods, with the continued push into physical retail. The plan outlined by Alibaba, is to open two giant car vending machines in early 2018, shaped like a futuristic tubular building with a giant cat’s head on top.

Having monopolized the online world, Alibaba continues to push offline with investments in Chinese bricks and mortar retailers.

Alibaba CEO Daniel Zhang said back in November, “physical stores serve an indispensable role during the consumer journey, and should be enhanced through data-driven technology and personalized services in the digital economy.”

“By fully integrating online and physical channels together with our partners, we look forward to delivering an original and delightful shopping experience to Chinese consumers,” he added.

So how does this vending machine work?

The smartphone user must open Alibaba’s Taobao app to scan a car. The app will then process the picture and let the user pick a color and other basic options.

Next, the app will require the user to take a selfie to confirm their identity. Once confirmed, the app will arrange for a test-drive at a car vending machine.

To retrieve the car, the customer will gain access through a facial recognition device at the staffless vending machine. According to the company, a “super member” does not need to leave a deposit to retrieve a vehicle.

Once the identity is confirmed, the multi-floor vending machine will rotate cars like a ferris wheel until the car is found. The test-drive is limited to three days, after which Alibaba can arrange for the sale or the user can choose a different model. Alibaba members are limited to five test-drives per month, where Alibaba is relying on its financial services arm to vet members before borrowing.

Alibaba said it will open two locations starting in January 2018 (Shanghai and Nanjing), and it plans to open “dozens” more across China later in the year. The vending machine concept blended with car buying, is an attempt by the company to streamline the buying process to as quick as opening a can of soda.

“Our thinking behind the Car Vending Machine is focused on helping users solve certain problems they face in the car-buying process. To do that, we are building a physical, experiential store that offers staffless car pickup through facial-recognition, three-day ‘deep’ test-drives, and a one-stop-shop that displays [cars from] all mainstream brands at once,” said Huan Lu, marketing director of Tmall’s automotive division.

World"s First Vending-Machine For The Homeless To Be Unveiled In UK In December; LA, NYC Next Year

This is a first, a new charity in the UK called Action Hunger plans to install a vending machine for the homeless in December. The organization describes itself as a charity with a “new approach to combating homelessness.” The initial plan will be installing a machine in the town of Nottingham in the December time-period, then a second machine in Manchester sometime early 2018. If all goes well, Action Hunger plans to do a full release across the UK in attempt to alleviate poverty and hardships– something the government is having trouble in doing.

Action Hunger is working with Tesco and other partners to stock the machines with water, fresh fruit, energy bars, crisps, chocolate, and sandwiches, as well as socks, sanitary towels, antibacterial lotion, toothbrush and toothpaste combination packs, and books. A majority of the food will be provided by a localized network of regional food vendors who will donate excessive food waste.

The charity has partnered with The Friary, an outreached centre in the city, to oversee the people’s access to the vending machines. The machines will operate 24-hours a day accessed by a special card given out by the Friary and can service up to 100 homeless people per day. Key cards are programmed to permit up to three items per day, which offers a low-cost automated solution in dealing with the poor.

Action Hunger explains how the process works: 

According to the Independent, homelessness has increased 34% per cent since the Conservatives came to power in 2010, partly due to benefit cuts and welfare changes. A new study reveals that 300,000 people in Britain are now homeless, with the crisis growing as much as 13 per cent last year alone.

Number of rough sleepers across England on a given night

Number of homelessness applications made to local authorities

Action Hunger is targeting Nottingham and Manchester, two areas where homelessness is out of control.

Across England, housing market affordability is once again above 2006 to 2008 levels— signaling that house prices are once more outpacing income.

Besides the exploding homelessness situation in the UK, there is an even larger market in the United States, where Action Hunger will be installing the vending machines next year in Seattle, New York, and LA.

In August, we reported 1 in 7 New York City Public-School students is homeless. On top of that, NYC shelter officials have admitted a record number of homeless to shelters each night.

In a preview of things to come, automation in the form of vending machines seems to be the short term solution in dealing with the homeless in the UK. The next step for Action Hunger appears to be a multi-city rollout in the United States targeting a much larger homeless population as the middle class deteriorates.

For our American audience, an automated vending machine for the homeless is coming to a town near you. The dying middle class will no longer be able to shop at the Dollar Tree nor Walmart, as they will resort to automated vending machines. The future is bleak.

There Is Now A Vending Machine For Luxury Cars

Singapore has injected nitrous into its reputation as a playground for the superrich after a local used-car dealer launched a "vending machine" with 60 luxury cars, including Bentleys, Ferraris and Lamborghinis, on offer. Used car seller Autobahn Motors opened a 15-story showroom in December in a futuristic looking building, dubbing it the "world"s largest luxury car vending machine," according to Reuters, which interviewed Gary Hong, the company"s general manager.

A view of the Autobahn building, located at 11 Jalan Bukit Merah, from August 2016, can be found on Google Maps. While the view predates the showrooms official opening, much of the inventory can be seen from the street.

Potential customers use a touchscreen to pick the car they wish to see; the selected car then arrives within minutes.

Speaking to Reuters, the general manager at Authobahh, Gary Hong, said the vending machine format was aimed at "making efficient use of space in land-scarce Singapore as well as standing out from the competition. We needed to meet our requirement of storing a lot of cars. At the same time, we wanted to be creative and innovative."

Better yet, Gary"s idea appears to be a hit: since its launch, Autobahn has been approached by developers who"d like to use the concept for parking services in the densely populated city-state, Hong told Reuters. 

That said, the concept isn"t unique to Singapore: in March, the U.S.-based firm Carvana opened a similar structure in San Antonio that can hold up to 30 cars.

So with the supply "issue" taken care of, what about demand? Here things are a little shakier.

Singapore"s economy has been on a roller-coaster in recent months, crashing in the third quarter before surging over 9% in Q4 -the fastest pace of growth since 2012 - before it again contracted by 1.9% in Q1.  Economists polled by the Singapore Monetary Authority, the city-state"s central bank, in March raised their forecasts for 2017 GDP to grow 2.3% in 2017, up from the 1.5% estimated in the previous survey published in December. But the rising optimism has yet to be reflected in the SMA"s policy outlook; in April, the central bank left its guidance unchanged, saying a "neutral" stance will be needed for an extended period of time.

Meanwhile, the real driver behind the economy emerged on Monday, when private-home sales more than doubled in April from the same period a year earlier. In short, the local asset bubble - a function of the much bigger bubble over in China - is back. The good news, at least for Gary, is that he will likely have quite a few clients to satisfy for the foreseeable future.