While some online and physical businesses that offer services and smaller goods have made the move toward Bitcoin, the currency had not caught on with sellers of cars and other vehicles (aside from a few half hearted marketing ploys, one time deals or donation schemes).
Tomcar Australia CEO David Brim likened Bitcoin to the innovation credit cards represented in the 1970s. “When our Tomcars are suited to many driving environments, it makes sense to accept a global currency without nation-state borders,” Brim said.
Tomcar will use CoinJar as its payment gateway, and customers buying online will simply be able to select Bitcoin as a payment option. CoinJar will allow Tomcar to appraise the value of a vehicle in Bitcoins in real time. For its part, CoinJar takes 1% for every transfer.
Brim said CoinJar will offer his company stability when dealing with a less-than-stable currency.
Obstacles for International Buyers
Brim said a key motivator to make the switch to Bitcoins was the cost of transactions for overseas customers. At the moment, only 5% of Tomcar’s sales are to buyers outside of Australia, and accepting an easily exchanged currency could allow the company to grow its international sales.
The company was already paying some overseas suppliers with Bitcoins because of the small fee for transactions, compared with the 6-12% charge for a standard money transfer. So it was a logical move to offer customers the same possibility to save on transaction costs. In fact, Brim admits he is actively trying to persuade other suppliers to accept Bitcoin.
A need for tougher all-terrain vehicles in the Israeli military led to the development of the first Tomcar. In 1967, after a unit of commandos had all six of their Jeeps destroyed in an air deployment, one of the soldiers reassembled parts from the wreckage into two working vehicles. This became the Tomcar’s prototype.
The company has multiple military and commercial customers, and their vehicles start at just less than AU $25,000. Manufacturing is outsourced, which is why Brim is so keen to manage transaction costs.