Is Carvana Broken?!?

[RonFLA]

I don't think Carvana should be too impacted by recalls. New vehicles cannot be sold w/ open recalls, but used vehicles generally can (if properly communicated to the customer). They may find that people don't want a Maverick with an open recall, but I don't think there is anything that prevents them from selling it.

It would seem like good common sense for Carvana to have a policy to not sell a vehicle with an unresolved recall, due to liability, but it turns out you’re right. Per their website, Carvana just passes that along to the buyer to deal with.

https://blog.carvana.com/2017/05/carvana-answers-your-recall-faqs/

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[es7129]

I don't think Carvana should be too impacted by recalls. New vehicles cannot be sold w/ open recalls, but used vehicles generally can (if properly communicated to the customer). They may find that people don't want a Maverick with an open recall, but I don't think there is anything that prevents them from selling it.

It would seem like good common sense for Carvana to have a policy to not sell a vehicle with an unresolved recall, due to liability, but it turns out your right. Per their website, Carvana just passes that along to the buyer to deal with.

https://blog.carvana.com/2017/05/carvana-answers-your-recall-faqs/

It depends on the recall. If there’s a stop sale they won’t allow you to initiate the purchase.

 

[cavemold]

Check it now. Unless it's top of the line, it won't be over 30k.

It’s gone down to 28k for July as of yesterday

 

[michaelmac8]

I am currently awaiting my Vroom offer.

Vroom is even worse. My guess is that Vroom will be out of business by the middle of next year (if not sooner) and Carvana will be gone by the end of 2023.

 

[2cafn8d]

For giggles I looked and mine sits at a little over 26k. I have zero desire to sell, but figured I'd check to see how mine stacked up.

 

[huunvubu]

Vroom is even worse. My guess is that Vroom will be out of business by the middle of next year (if not sooner) and Carvana will be gone by the end of 2023.

Vroom's offer is $34,500.

I don't understand the hate for Carvana or Vroom

These and other online car purchase companies serves a vital counter to the rip-off dealer trade-in offers.

I got my Maverick because Carvana offered and paid me $16,523 for my 2015 Honda Fit Ex whereas the dealer I ordered my Maverick from was trying to rip me off by offering $11,750

 

[cjmcclu2]

I am planning on trading in a Dodge Minivan, they quoted me 23k on 7/6. On 7/19 they quoted me 17k. Supposedly used car prices are falling fast. I may have lost at least 6k on trade cause I still haven't gotten my Mav.

I was planning on trading in my 2017 Civic Hatchback. Around the time I ordered my Mav, KBB was telling me it was worth $21k private party, which is as much as I bought it for, $18k if I traded it in. Here we are ten months later, some idiot ran a stop sign right in front of me, had to replace the whole front end. Long story short, the "appraised value" of it now according to the DMV based on the letter I got last week to renew my registration... $7700. So much for trade in value. I still owe more than that.

 

[TKranbuhl]

I sold my Mazda CX-5 to CarMax when I bought my Maverick. The process went well. They gave me what I paid for it almost 2 years ago.

 

[Finnster]

If the Carvana, etc. offers all drop down to near MSRP, maybe those of here waiting for a Maverick to keep will get it a little sooner! I hope so.

 

[michaelmac8]

I don't understand the hate for Carvana or Vroom

Other than unrealistically inflating the market with car prices, my only other gripe with them is that they make it very difficult to find a local car. Autotrader/Cars.com are completely flooded with their cars that are on a completely different side of the country.

 

[10Terp]

I sold my 2012 Mustang GT to Carvana for $21k a month ago; I think they're down to around 15k now. Glad I jumped on that when I did.

 

[bake]

The other side of the coin is buying from Carvana. I had an accident back in May which made it imperative to get a new vehicle. Circumstances dictated that I get a small pickup with club cab and was a hybrid. Some research narrowed the possibilities to a single choice--maverick. But, when I started checking around at dealers I found that that getting a maverick immediately was a pipe dream if ever there was one. I was despondent. Then my wife took charge and found 3 mavericks on Carvana. One was an XLT hybrid, the other two ECO gas engines. The hybrid had 202 miles; it was perfect. Didn't have all the bells and whistles but had everything I needed. I am sure that I paid too much, 42k, but I could afford it and I really wanted that truck; and the extra cost beat the hell out of waiting a year for something I needed immediately. And I love it!

 

[pxpaulx]

I think ultimately where a business model like Carvana's falls short is that they have to create a model where you have sellers to grow your inventory, but also buyers that are willing to buy-in to a simplified process.

It sort of requires a front-end load where you pay more $ to increase your inventory, and hope that a significant % of those people also buy from you on the backend. You do after all (and depending on state of residency) get a tax advantage by both selling and buying with the same dealer (I think most states are like this, though not all).

The problem is, when the used car market values increased significantly, in order to perform step 1 (buy inventory), they had to be the top of the pack - this resulted in paying out values so high that the tax savings became surpassed by direct trade ins (i.e. they are paying more than the difference which means any potential buyers can look elsewhere and still come out ahead), which led to increased inventory without an increase in buyers.

Eventually the idea is to become such a giant in the industry that you have sway in the buying/selling process of the industry as a whole, however if your potential buyers are going to other dealers then Carvana is left holding high $ inventory with no buyer market to unload that inventory.

 

[michaelmac8]

XLT hybrid
42k

Big oof. You're telling us that you needed something THAT badly that you'd pay 18k over MSRP for a used Maverick?

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