Now that consumers can use the Internet to put a squeeze on auto dealers' profit margins, car dealerships are looking to the Web to help them fight back. One option: use the Internet to cut their operational costs.

The financing unit of American Honda Motor Company next month will begin rolling out its Dealer Financial Information Network (DFIN), a Web system that will help its 3,000 dealers obtain financing for inventory in real time, according to a Feb. 23 Internet Week story by Chuck Moozakis. Currently, dealers purchasing inventory from Honda need to apply for financing through American Honda Finance Corporation or another bank. Typically, approvals take several days.

Through DFIN, dealers will be able to apply for financing online, according to Moozakis' story. They will be notified immediately whether financing is approved, making it more attractive for them to turn to AHFC rather than other lending organizations, according to Arnold McCullough, AHFC's senior project manager.

McCullough said a small group of dealers will begin testing DFIN in March; full national rollout is expected in April.

Honda will offer DFIN to all of its automobile, motorcycle and power equipment dealers throughout the United States. The network will replace a system that requires manual intervention on the part of AHFC administrative offices.

DFIN should give AHFC a leg up as it competes with banks and other financing organizations to get dealer business, said J. Ferron, consulting leader for PricewaterhouseCoopers' automotive consulting group. "Banks aren't on top of every incentive and financing program that Honda might be promoting, and because of that, they won't necessarily be offering dealers the same advantages," he said.

DFIN will give Honda dealers a browser-based link to financing and inventory data now stored in mainframe computers at AHFC's Torrance, Calif., headquarters, McCullough said. Through that link, dealers will be able to retrieve financial information -- such as the cost of a car, insurance quotes and the amount of credit a customer has -- and tell AHFC how to manage their accounts.

With DFIN, dealers will now be able to communicate directly with AHFC, bypassing the current system that requires regional administrators to take a dealer's orders and rekey them into Honda's internal systems.

Beyond financing and inventory management, McCullough said, AHFC intends to layer additional capabilities onto DFIN. For example, the network will let dealers trade vehicles with fellow dealers much more easily.

DFIN will be based on a hosted service from bTrade. The service consists of EasyAccess, software that moves inventory and financing data from AHFC's mainframe to a system called SecurePortal, which stores that data in an Oracle database. The data is parsed; when a dealer logs into the system, he sees information only his dealership is entitled to view.

AHFC is still determining what fees--if any--it will charge dealers to connect with DFIN, according to Internet Week.