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Mr_Asa
Mr_Asa GRM+ Memberand UltimaDork
11/21/22 1:32 p.m.

So, Carvana is going under.  Might take a bit, but they've been playing fast and loose with the laws in various states for a while.

They just fired another batch of employees. (1500 this time, 2500 in May)

There are anywhere from 50,000-70,000 cars in their inventory.  If they go under no one dealer is going to be able to purchase them all.

Is this going to move the needle on dropping used car prices back where they belong?

Javelin
Javelin GRM+ Memberand MegaDork
11/21/22 1:43 p.m.

In reply to Mr_Asa :

I sure hope so!

GameboyRMH
GameboyRMH GRM+ Memberand MegaDork
11/21/22 1:54 p.m.

Hard to believe it wouldn't. Looks like Carvana let the AI that does their car buying run on the assumption of a "forever pandemic" and it simply grabbed up and hoarded every car it could at peak-pandemic prices, and now that the pandemic is approaching an end (hopefully) and new car production is increasing, they're left holding the bag.

RX Reven'
RX Reven' GRM+ Memberand UltraDork
11/21/22 1:58 p.m.

Down 97% Year-Over-Year surprisesurprisesurprise

¯\_(ツ)_/¯
¯\_(ツ)_/¯ UltimaDork
11/21/22 1:59 p.m.

At what point can we get those big silly vending machines at deep discounts?  Just picture this bad boy stacked to the roof with challenge cars:

Check out this 5-story coin-operated vending machine that dispenses cars

trigun7469
trigun7469 UltraDork
11/21/22 2:01 p.m.

I wonder if dealerships will purchase the Carvana name like Autonation as their used car business for marketing purposes. 

californiamilleghia
californiamilleghia UltraDork
11/21/22 2:15 p.m.

They seemed to have a problem getting buyers a title on the cars they sold , 

I am sure it was a mess with 50 state DMVs , maybe it's impossible to get that working properly 

Andy Neuman
Andy Neuman SuperDork
11/21/22 2:27 p.m.
¯\_(ツ)_/¯ said:

At what point can we get those big silly vending machines at deep discounts?  Just picture this bad boy stacked to the roof with challenge cars:

Check out this 5-story coin-operated vending machine that dispenses cars

They have one in Jacksonville, time to start talking Jeremy into buying it. 

eastsideTim
eastsideTim UltimaDork
11/21/22 2:28 p.m.
californiamilleghia said:

They seemed to have a problem getting buyers a title on the cars they sold , 

I am sure it was a mess with 50 state DMVs , maybe it's impossible to get that working properly 

Not impossible, they just didn't want to spend the money on manpower to do it correctly.

While it may affect use car prices a bit, I suspect them going under will not move the needle too far.  Used dealers still seem to be short on inventory, so they may be able to absorb quite a bit.  Now, if Carvana fire sales a bunch of inventory in an effort to stave off bankruptcy, that could cause a momentary depression in prices, and it might be wise to jump quickly.  Just don't expect them to be around to cover any problems the car might have.

¯\_(ツ)_/¯
¯\_(ツ)_/¯ UltimaDork
11/21/22 2:30 p.m.

In reply to Andy Neuman :

He's got the inventory ready to go and everything!

John Welsh
John Welsh Mod Squad
11/21/22 3:14 p.m.

They have Carvana Access also, which is their "direct to dealer only auction platform" 

dculberson
dculberson MegaDork
11/21/22 3:26 p.m.

50,000 - 70,000 cars isn't a lot in a nation of 330 million people. I don't think that would move the needle at all, but them no longer paying ridiculous prices for late model and low mileage used cars might help.

Sadly they tore down a gokart track here in town to build one of their glass car vending follies, so it's too late for us to save the track.

red_stapler
red_stapler SuperDork
11/21/22 4:26 p.m.
dculberson said:

50,000 - 70,000 cars isn't a lot in a nation of 330 million people. I don't think that would move the needle at all

About 115k used cars are sold every day in the US, so Carvana's entire inventory could be sold off in about 12 hours.

Peabody
Peabody MegaDork
11/21/22 5:04 p.m.
GameboyRMH said:

Hard to believe it wouldn't. Looks like Carvana let the AI that does their car buying run on the assumption of a "forever pandemic" and it simply grabbed up and hoarded every car it could at peak-pandemic prices, and now that the pandemic is approaching an end (hopefully) and new car production is increasing, they're left holding the bag.

I called that here early on in the price frenzy. I was told it couldn't happen, something about the new normal.

dyintorace
dyintorace GRM+ Memberand PowerDork
11/21/22 5:30 p.m.
red_stapler said:
dculberson said:

50,000 - 70,000 cars isn't a lot in a nation of 330 million people. I don't think that would move the needle at all

About 115k used cars are sold every day in the US, so Carvana's entire inventory could be sold off in about 12 hours.

Roughly 42M used cars are sold each year in the US? That seems like a lot!

pheller
pheller UltimaDork
11/21/22 5:58 p.m.

Seems like the only way we're going to end up with cheaper used car prices is to have new car prices start being paired with incentives and an oversupply of inventory. Right now, dealers pretty much everywhere are still desperate for inventory. 

 

For better or worse, this is a product of "just in time" manufacturing - if the manufacturers can determine exactly what the demand will be by the time the car rolls off the line, they aren't going to produce anything more than that. 

 

Some friends of our just bought the van we want to buy: a 2022 Toyota Sienna Hybrid. They paid $36k for it. No markup. The dealer had a used 2021 Sienna on the lot. Despite not having any additional options, they wanted an extra $8k for it. Basically, if you wanted a van today, they'll upcharge, if you're willing to wait, they'll give it to you at MSRP. 

former520
former520 HalfDork
11/21/22 6:41 p.m.

I read an article today that they sold 7,000 cars in a bundle to a dealer group at 10-15% wholesale pricing.  The dump has begun.  Repos are way up also.  Will be interesting to see what happens in the following months.

dculberson
dculberson MegaDork
11/21/22 7:20 p.m.

In reply to dyintorace :

Yes, amazingly enough, there are 40+ million used cars sold in the us a year. There are almost 187,000 used car dealerships in the us!

einy (Forum Supporter)
einy (Forum Supporter) Dork
11/21/22 7:35 p.m.

Local Ford dealer in Northeast Cincinnati suburbs has a huge sign that all models except Mach E, Superduty, Bronco, and Maverick are being sold at invoice.  Not that these are nice guys, as they post unclaimed Mavericks at $10k over MSRP.  Point is, I think even new car supplies are starting to normalize a bit.

eastsideTim
eastsideTim UltimaDork
11/21/22 8:09 p.m.

In reply to einy (Forum Supporter) :

Lebanon?  Or someone else?

dps214
dps214 Dork
11/21/22 8:15 p.m.
dculberson said:

Sadly they tore down a gokart track here in town to build one of their glass car vending follies, so it's too late for us to save the track.

So I guess that's not going to happen, huh? I was kind of excited just for the spectacle of it. I never went to magic mountain, but based on all the comments when it was bought out by carvana, there wasn't much there worth saving.

It's a shame, the concept is good they just miseed on execution I guess. I'm used car shopping at the moment and dealing with dealers is awwwwwwful, and somehow none of them have heard of email communication or e-signing documents. Carvana's inventory of the vehicle I'm looking for is slim (not shocking, I guess) but the temptation to just pay their price premium gets stronger every day. Maybe I can find the sweet spot of when they start fire sale-ing their inventory but still are able to afford to send out the title?

Steve_Jones
Steve_Jones SuperDork
11/21/22 8:17 p.m.

einy (Forum Supporter)
einy (Forum Supporter) Dork
11/21/22 8:52 p.m.
eastsideTim said:

In reply to einy (Forum Supporter) :

Lebanon?  Or someone else?

Kings Ford

eastsideTim
eastsideTim UltimaDork
11/21/22 8:54 p.m.
einy (Forum Supporter) said:
eastsideTim said:

In reply to einy (Forum Supporter) :

Lebanon?  Or someone else?

Kings Ford

Oh yeah, should have thought of that one.  I bought an F-150 from them ages ago.

vwcorvette (Forum Supporter)
vwcorvette (Forum Supporter) GRM+ Memberand UberDork
11/21/22 11:29 p.m.

How is Vroom doing? We got our i3 from them and sold our Promaster to them. Was not a great experience. Wouldn't recommend.

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