The internet now helps to lead more late-model, used-vehicle buyers in the US to the vehicles they purchase than traditional newspaper and magazine classified ads combined, according to the JD Power and Associates 2005 Used Autoshopper.com study.

"Online advertising, including classified ads, auctions and other leads have overtaken print, and it is very likely to remain that way," said Dennis Galbraith, senior director of research at JD Power and Associates.

"Shoppers tend to go where the inventory can be found, and advertisers place their inventory where the shoppers can be found.  Market share brings a barrier to entry in the used-vehicle classified market. It is clear that online classified ad services such as AutoTrader.com and cars.com have broken through those walls by gaining the necessary market share. There is little reason to expect anything but continued growth in online classified services at the expense of print."

While the percentage of used-vehicle buyers using the internet in their shopping process has remained relatively flat (53%), the internet continues to grow in its ability to impact the shopping decisions of those who avail themselves of the medium. Among all buyers, nearly one-fourth (24.3%) are impacted in their seller selection decision by information found online, up from 22.5% in 2004.

Manufacturer web sites are also becoming increasingly important.  While 90% of automotive internet users still visit independent sites such as Kelley Blue Book's kbb.com or Yahoo! Autos, 74% visit a manufacturer-sponsored site such as FordVehicles.com or Chevrolet.com to look for used vehicles, up from 70% in 2004.

"Manufacturers have a vested interest in making sure their dealers are able to sell [used] vehicles quickly, and they are getting increasingly serious about it," said Galbraith. "The better these vehicles are marketed, the faster the inventory turns and the higher the residual values and the lower the depreciation. This helps new-vehicle buyers with lower lease rates and better trade-in values."

Dealer sites play a vital role in online shopping. More than one-half (52%) of all shoppers who credit the internet with leading them to the vehicle they purchased indicate a dealer site as the primary online source. About one-half of these shoppers state that an independent site, manufacturer site or search engine directed them to the dealer's site where they found the vehicle they purchased.

While online shoppers take different paths to the used vehicles they purchase, the use of search engines is nearly ubiquitous. Among shoppers who use the internet in their shopping process, 94% use one or more search engines, with Google, Yahoo! and MSN among the most frequently used.

Internet use is expected to grow as new technology makes shopping online simpler and easier.

"The automotive industry must do a better job of making online shopping efficient," said Galbraith. "The web sites must also do a better job of meeting the needs of those shoppers with less-than-average vehicle knowledge or model preference. Over the 10-year automotive history on the internet, this industry has demonstrated that identified customer needs don't go unmet for long."

The 2005 study is based on responses from more than 14,000 owners of used vehicles who purchased used 2000-05 model-year vehicles.