Carvana stock posts worst day ever as outlook darkens for used vehicle market

[Bikeman315]

The beginning or the end?
https://www.cnbc.com/2022/11/04/car...-outlook-darkens-for-used-vehicle-market.html

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[Zach@Granger]

The beginning or the end?
https://www.cnbc.com/2022/11/04/car...-outlook-darkens-for-used-vehicle-market.html

They don't have a sustainable business model and their administrative side is very sloppy, banning them from sales in most states.

It was a good thing while it lasted for those who were opportunistic and sold their vehicles to them for inflated prices, but I don't think they'll make it through the used car market correction coming here shortly.

A business model like Carmax is a sustainable used car focused model, unlike Carvana or Vroom.

 

[Inthehighdesert]

I’ve never understood the growth at all costs mentality. Carvana pretty much refused to clean up there administrative side and there now paying the cost. it’s baffling they didn’t fix that. And it’s no surprise there staring to lose license’s in states. Couple that with a monetary policy from the powers that be and its easy to see where this may be headed. The absurdity of auto loans(credit unions) being less then mortgages is ……

 

[Balr14]

I wonder if this would be a good or bad time to trade my car with Carvana?

 

[kellyreno]

Just another Wall Street rip off to look back on. Never had a sustainable business model. High of $360 on 8-21. Down -96% YTD. I would bet the CEO did not take a hit. The rest went to the short sellers and hedge funds. The American way.

 

[shogun32]

6-9 months they'll declare bankruptcy or get bought for vanishingly small price from another of the duo's shell companies, or a 3rd party. It was a get rich quick scheme from the get-go I think. via Investor money - investors who for a decade have been failing at even 3rd grader's level of due diligence.

 

[RagmopInKona]

These , online car dealers, that whole marketing is, no dealing with a sleezeball salesman, Just seemed like a shell company to launder money through.
I have heard horror stories of the vehicle delivered to the customer being No where near the shape the listing claimed. Then the headache of dealing with that. Many with washed titles.
I could see this type thing working , if it was a business model of just buying Wholesale auction vehicles, making sure they are good and repairing faults and then retail selling them, with no buying questionable customer cars, trade in's . and not for stupid ballooned values. the old sell high, buy low. they forgot about. Buying vehicles like they were in a bidding war of two drink guys at a Barrett Jackson auction was only going to bite them .

 

[Cobra Jet]

Most recent news - Carvana laying off 1,500:
Carvana Slashes 1,500 Jobs In Latest Sign Of Big Problems https://carbuzz.com/news/carvana-slashes-1500-jobs-in-latest-sign-of-big-problems

Just last week:
Carvana has (2) locations in PA that were suspended - one is noted as being indefinitely suspended, the other may be back operational at end of Dec. 2022....

Two Carvana Locations Suspended In Pennsylvania Two Carvana Locations Suspended In Pennsylvania

 

[MAGS1]

They’ve had their business suspended here in IL numerous times due to their failure to submit title and registration info within the required time frame. The concept of Carvana and Vroom I think can work because there is a general disdain for the traditional car buying process but you have to make sure your administrative side is buttoned up and have good procedures to handle high volume. Carvana obviously screwed up on that end, not sure if a room is any better. I personally would never buy a used car without being able to test drive it and give it a good look over but there are plenty of people that love the Carvana/Vroom model

 

[shogun32]

personally would never buy a used car without being able to test drive it and give it a good look over but there are plenty of people that love the Carvana/Vroom model

and both of them AFAIK have no questions asked 3-7 day money-back guarentees. In no small part I'm guessing CarMax's 24hr test drive program was in response to competitive pressure.

I agree it was a good idea in theory - just grossly mismanaged and an army of clueless neophytes buying cars with OPM (other people's money) that got them saddled with overpriced inventory.

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