Car dealer turns to bitcoin sales

An Orange County Lamborghini dealership, which already prided itself on selling more cars than any other in the country, may now have hit the car sales jackpot.

This week, the dealership shipped its first-ever vehicle purchased using a digital currency known as bitcoin. A second sale to a bitcoin user was being processed Wednesday.

"That's pretty good," Cedric Davy, marketing director at Lamborghini Newport Beach, said with a hint of astonished glee. "We're making a business out of this."

Whether a customer offers to pay for a car in gold bars or euros is irrelevant so long as the currency is converted into dollars, said Davy, whose dealership — despite its Newport name — is located on Baker Street in Costa Mesa.

Neither of the recent buyers, after all, walked into the showroom lugging a bag of bitcoins.

Doing so would have been impossible because the bitcoin, unlike more traditional currencies, is not represented with paper or metal. It's a virtual currency. "Minted" in a finite amount by a computer programmer in 2009, the bitcoin is rather understood in a less tangible sense — if it is understood at all.

"It was a little odd. For me, it was very odd," said Nick Jones, a general sales manager who facilitated the first transaction. "I didn't know much about bitcoin, but I never want to turn away business or tell a customer 'no' until I'm sure that I can't do what the customer is asking me for."

After some investigation, the dealership decided to use an independent, Atlanta-based service called BitPay, which advertises itself online as a "bitcoin payment processor," to make the sales possible.

Davy can't quite explain how it works, but the business verified the bitcoins and converted them into dollars, which were then wired to the dealership.

BitPay facilitates such payments worldwide, likening itself to a credit card company or Paypal. As of Wednesday, the company had processed more than $100 million in transactions this year. Rather than taking a percentage of the sales, the firm charges access fees to use the service.

"One of the advantages of bitcoin is that you can do massive purchases like that, and you don't even need an American Express black card," said Stephanie Wargo, vice president of marketing at BitPay. "From our standpoint, there's really no limit."

An informational BitPay video offers this rationale: "You don't even have to know what the heck a bitcoin is."

A Jeep, Dodge and Chrysler dealership in Kansas has been using the service for awhile, as have car rental companies in Chicago and New York, BitPay spokeswoman Jan Jahosky said, adding that within the past week a Toyota dealership in Massachusetts joined the growing crowd.

Several luxury car dealers' memberships are pending, she added.

The first to go at the Costa Mesa Lambourghini dealership was a pre-owned Tesla Model S for $103,000, or 91.4 bitcoins, to a man in Florida.

Next will be a brand new Lamborghini Gallardo for $209,000, or 216.8 bitcoins, to someone in Missouri, assuming the payment clears.

Salesmen have received at least 10 calls from others interested in trading the currency for exotic cars, Jones said.

"We've opened up a whole new group of clientele," he noted. "There's a lot of guys out there that have these bitcoins, and maybe didn't know they could purchase an exotic vehicle."

New McLarens and Lamborghinis still line the dealership's lot. A 2007 Lamborghini LP640 Versace edition, one of 20 in the world, remains in the showroom for $219,000. Next to it shines a 2014 Gallardo Squadra Corse — one of 15 in the United States — available for $272,000.

For a dealership that typically sells 20 to 30 high-end new and used cars a month, these could be going fast.

As another salesman put it, shaking his head in bafflement: "It's a strange world."

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