Cyberspace is once again making a big splash in physical space: With its lean-and-mean real estate model, online auto "e-tailer" iMotors.com (www.imotors.com) is establishing a facility in the Cincinnati metro that will employ 900 workers at build-out. The facility will serve as one of the company's Vehicle Certification Centers (VCC).

CEO Adam Simms called the new facility, which will serve the U.S. East Coast, "a vital component of our national expansion strategy." Reflecting the online world, San Francisco-based iMotors is moving fast. Company officials expect the refurbished facility in the city of Westchester to be operational in a matter of weeks. From there, the VCC will steadily add employees to reach 900 workers, they say.

New Facility Part of Global Expansion

A similar slam-bang pace earmarks iMotors' overall expansion strategy. While announcing the new Cincinnati facility, company officials also announced that iMotors will open a VCC in the Atlanta. Both the Cincinnati and Atlanta facilities were formerly owned and operated by AutoNation.

Those two additions up the total number of iMotors VCCs to three, including a facility near Sacramento, Calif., that supports all of the company's West Coast delivery centers from San Diego to Seattle. More VCCs are in the pipeline. IMotors recently announced a US$300 million multi-year agreement with Bechtel to build up to 30 additional VCCs worldwide.

'A Used Car Factory'

The new Cincinnati facility will be a "state-of-the-art, high-production, used car factory" - which is how iMotors bills its VCCs.

The VCCs' activities center around the testing, inspection and certification of the used cars that the company handles. Each car, according to iMotors' officials, goes through a 129-point inspection and certification process. The VCCs' certified mechanics and technicians work in "specialized teams" to make needed repairs and perform preventive maintenance. The VCC certification inspection and process takes an average of four to five days, the company says.

At peak capacity, the average VCC can, in one day, "output" 48 cars that have completed the inspection process, according to company officials. When vehicles are delivered, each customer receives an iMotors "AutoBiography," which provides the details of the car's history and work performed at the VCC.

Lean Real Estate Model
Is Where the Money Is

Only launched in September of 1999, iMotors has rapidly expanded with the success of its business model, which sells custom-ordered used cars over the Internet. That model minimizes space needs, since the company has no superstores, no inventory and no salespeople. And that, according to company officials, is where the money is.

Says a company spokesman, "These [real estate] savings, coupled with efficiencies created by our process and use of proprietary technologies, allow us to offer lower prices to our customers while still running our business profitably."

In fact, IMotors' 1999 launching prompted "Car Today" magazine (www.cartoday.com) to comment, "There are similarities to the brokerage services available in the U.S., UK and other territories, but important new features could make this a global model for a radically new way of selling cars."

IMotors bills its prices as guaranteed, and backs every car with a three-month/3,000-mile (5,100-km.) limited warranty and a seven-day/700-mile (1,190-km.) money-back return policy.

"Unlike other online automotive companies, iMotors is a retailer, and as a retailer, we take full responsibility for the quality of our product," added Simms. "This new [Cincinnati] VCC allows us to ensure that we continue to deliver high-quality, used vehicles that exceed our customers' expectations."

A privately held company, iMotors has attracted a number of well-known investors. Those investors, say company officials, include Global Retail Partners, Moore Capital Management, MeriTech Capital Partners, Oak Investment Partners, Rosewood Capital, Trinity Ventures and Vulcan Ventures.