competition in a duopoly

Filed in archive Entrepreneurship on November 14, 2003

This article (in German only) displays the battle between mobile.de and Autoscout24.de. The online market for used cars makes a good example of successful online marketplaces and competitive pressures. Both sites create an interesting duopoly for some years now. They both initially focused on getting market share and turning to profitability later. Both have approximately 750.000 cars listed. Some weeks ago mobile.de has introduced listing charges and listing suddenly dropped sharply. Now the leadership might be in new hands. Some pundits are already predicting a monopoly by Autoscout24.de in some years from now on and smooth introduction of charges than.
At the moment more than 50% of used car sales in Germany is channeled through the Internet. Although ebay grows by 100% in Germany, it has a difficult time to enter the used car market space. Cars are a "citron market" and buyers want to validate a car before buying. There is hardly a space for online auctions afterwards. The ebay model simply does not fit. The same reason applies to ebay's inability to enter the market for (new) capital goods.