I looked at some cars at Carvana. I believe they made money off the financing as previously stated. They had a couple cars I was interested in at a reasonable price, but when I looked at the rate they wanted, it was too high.
Carvana Layoffs
- Thread starter The Critic
- Start date
Zee09
$200 Site Donor 2022
Carvana made my transaction great.
Paid $6k more for my old Hybrid..
Crazy
Paid $6k more for my old Hybrid..
Crazy
the two vehicles I sold Carvana last year both sold again within a month and for more than I was paid...and I was paid what I'd consider well for them...
I keep up since last year on what the three other cars I help take care of and Carvana has been up again (prices have gone up and down significantly I think) on them...
Bill
I keep up since last year on what the three other cars I help take care of and Carvana has been up again (prices have gone up and down significantly I think) on them...
Bill
Looks like there is more to this story:
jalopnik.com
Carvana Lays Off Thousands of Workers, Buys Car Auction Company for $2.2 Billion on the Same Day
An estimated 2,500 Carvana employees will lose their jobs.
jalopnik.com
They will be bankrupt within 18 months. Too much cash burn and we're hitting a long overdue slow down in the used car market with higher interest rates and lack of access to late model inventory for those who are new car dealers like Carvana.
Chapter 11 by late 2023 if not sooner.
Chapter 11 by late 2023 if not sooner.
Putnam Lexus told me Carvana offered me great money when we were about to return our leased 2018 RX450h. They matched the offer as the RX hybrids are always in demand around here.
Not all business models work; in fact businesses have to change or will ultimately die out.
Not all business models work; in fact businesses have to change or will ultimately die out.
AZjeff
$50 Site Donor 2023
I'd still like to buy a car out of the vending machine before they go away.
M
You can't even take delivery of a new Tesla in Utah.
I have a few dealers in Idaho scoped out for my next new car dealer. Screw the dealers in Utah.
Meanwhile-there are a small group of players that control the new car market in Salt Lake City that make buying a new car in this state is a miserable experience and you pay more.
You can't even take delivery of a new Tesla in Utah.
I have a few dealers in Idaho scoped out for my next new car dealer. Screw the dealers in Utah.
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That's one!
Young is the other big player in Northern Utah dealerships.
But they don't control the market. There are plenty of others. There are other dealerships besides LHM and Young in Northern Utah, for any auto make that I can think of.
CKN, I've never bought a car from an LHM dealership. What in particular spoiled the experience, or experiences, for you?
https://www.yahoo.com/lifestyle/carvana-cuts-2-500-jobs-142545280.html
Interesting to note this comment;
"The company has never logged an annual profit over its 10 years of existence, preferring instead to plow cash flow into expansion."
That and those STUPID vending machines. Those things are a gimmick. What do you think those things cost to build and maintain? Maybe if they sold cars on an asphalt lot with a modest sales building they would be doing better.
And the story continues and says this;
"Earlier this year, Carvana announced plans to buy ADESA U.S., a vehicle-auction business, for $2.2 billion. The company has announced no changes to that plan."
So, they haven't been profitable in 10 years, yet they still spend $2.2B on expansion.
Tell me fellow peons, how many of us would be bankrupt and homeless if we managed our personal finances like Carvana?
No sympathy,
Scott
Interesting to note this comment;
"The company has never logged an annual profit over its 10 years of existence, preferring instead to plow cash flow into expansion."
That and those STUPID vending machines. Those things are a gimmick. What do you think those things cost to build and maintain? Maybe if they sold cars on an asphalt lot with a modest sales building they would be doing better.
And the story continues and says this;
"Earlier this year, Carvana announced plans to buy ADESA U.S., a vehicle-auction business, for $2.2 billion. The company has announced no changes to that plan."
So, they haven't been profitable in 10 years, yet they still spend $2.2B on expansion.
Tell me fellow peons, how many of us would be bankrupt and homeless if we managed our personal finances like Carvana?
No sympathy,
Scott
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Yeah, my car with 70k and 5 years old is supposedly worth 2k more than I paid new for it. Hopefully we get another 10 bajillion trillion in printed stimulus money so it's worth 15k more next year with 90k and 6 years old.
Looks like they are buying Adesa U.S., a wholesale auction platform at a $2.2 billion price tag. Remember what I said about them sending more cars through auction than any other dealer? Best way to liquidate your toxic assets is to buy the place that was charging you millions in fees on cars that we’re losing money to begin with, while also generating a bit of income on its own. I don’t see how Carvana survives, but this move is not a surprising one. It also signals to me that they have no real intention on changing their business model. They may make surface changes to keep investors from completely jumping ship, but I think largely it will remain the same.
GON
$100 Site Donor 2023
I thought Carvana's process was to make the transaction simple.....
Prices are dropping a bit on used cars so no surprise. Carvana is massive and flipped the card table on the used car market.
So glad I did not bite on a few less popular or higher mileage vehicles as I noticed they dropped about $2k from dealers.
I paid the premium in private market instead but got a great lower mileage 2013 southern car that will last me 5 years at least.
So glad I did not bite on a few less popular or higher mileage vehicles as I noticed they dropped about $2k from dealers.
I paid the premium in private market instead but got a great lower mileage 2013 southern car that will last me 5 years at least.
Carmax can offer more because they get to physically inspect your vehicle lowering their risk.
Others who do only virtually by you filling out a form assume more risk, assume they will take a bath on 1 in 4 vehicles so as a result have to build in more margin into each offer
Another factor here is I would wager that Carvana being a relatively new company, their employees are less costly to sever than Adesa's.
The Adesa play is a good move for Carvana, buys them a large physical and geo presence but also market 'maturity', but they will need to take significant costs out of the business.
The Adesa play is a good move for Carvana, buys them a large physical and geo presence but also market 'maturity', but they will need to take significant costs out of the business.
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