Beepi hits block in road

Online peer-to-peer used car marketplace Beepi, which received some $150 million of start-up funding, is to downsize operations and merge with a planned new venture founded by auto industry veterans.

California-based Beepi launched a website which matched sellers of used cars to purchasers, with the promise that vehicles would be vetted by its inspectors, brought up to standard and then advertised online and delivered to their new owners nationwide. It also offered leasing deals on used cars.

Having expanded into 16 areas of the US, the company has now announced it is shutting down its operations outside California and laying off 180 staff. Industry sources suggest part of the reason is the decision by a key backer – believed to be Chinese automaker SAIC – to pull out of the investment.

There are also reports that Beepi plans to merge with a new venture called Fair, which is being developed by three auto industry specialists: Georg Bauer, formerly of BMW, Mercedes-Benz, and Tesla; Scott Painter, formerly of TrueCar; and Fedor Artiles, formerly of Mercedes-Benz, Chrysler, Volkswagen, and Tesla.

Fair has yet to launch officially, but its website suggests the plan is to offer a platform for people not to buy cars outright but instead move to a flexible leasing model and a car selector based on their finances. “Enjoy the freedom to drive the car you want for as long as you want,” it notes. “And when you’re ready, you can trade up, try something new, or just walk away.”

Ale Resnik, co-founder and CEO of Beepi said in a statement: ‘Georg, Scott, and Fedor are auto industry veterans that I deeply admire, and I’m excited to join forces with them to focus on the future of the car-buying industry. Beepi will benefit immeasurably from this partnership.”