Auto parts retailer Merles is buying into the electric-car maker Tesla Motors Inc. in an attempt to help it win over consumers who have flocked to the company’s online store to shop for used cars and accessories.
The move is one of several deals announced Tuesday by major auto-parts retailers in a bid to help expand its online presence and diversify its product offerings.
The companies said they would invest $1 billion to expand their online presence.
Auto parts store Merles, which has a $10 billion market value, is buying up used cars at a faster pace than rivals such as Best Buy Co. and Sears Holdings Corp. The deal, which the companies said will be completed by the end of the year, comes as automakers have been struggling to gain traction with consumers in an increasingly digital world.
A report from Bloomberg last week showed that the share of U.S. consumers that use online retail has grown from 5.4% in 2009 to 10.9% in 2017.
While the U.K.-based retailer is among the big names buying used vehicles, the company said it will focus on new cars and equipment as it expands its business beyond vehicles.
“We’re taking a long-term view, and I think we’re making good business sense,” said Merles CEO Mark Gorman, who will take over as chairman of the company in July.
Merles Chief Executive Mark Gormley, left, and Merles chief executive officer Scott Tippett speak during the second day of the Automotive Show in Detroit.
The company has about 3,500 stores nationwide.
Tesla is the latest big name to announce deals with retailers as it tries to woo customers who are wary of buying new cars.
On Tuesday, Sears Holdings, which sells used cars, announced it would invest up to $1.7 billion to bolster its online inventory and build out its own inventory.
In a separate deal, Ford Motor Co. announced it will buy a $500 million stake in Tesla Motors in a deal that was approved by the U,S.
Securities and Exchange Commission.
Ford said it is “actively looking at” investing in Tesla, which it says is a “global leader in electrification and alternative energy.”
Tesla shares rose 5.2% to $39.80 in afternoon trading on Tuesday.