[avalys]

Yeah, exactly. "I loved Carvana because I bought a great car from them at a better price than the legacy players!" and "I loved Carvana because they bought my used car at a really good price!"

Guess what? Buying cars for too much money and selling them for too little money means they go out of business.

[maria2]

> "I loved Carvana because I bought a great car from them at a better price than the legacy players!"

That's literally the opposite of what the GP said:

> The buying experience was simply excellent for me, and I couldn't be happier with the car I bought. I figured I probably could have gotten a comparable deal slightly cheaper somewhere else, but I would have wasted a ton of time

I mean this politely, but did you really read what you were replying to?

[bluedino]

I think he was quoting the typical Carvana customer, not the parent poster

[dragonwriter]

> That's literally the opposite of what the GP said:

Its not, though. Its true the upthread poster focussed on “buying experience” not “price”, but the adverse parts of the typical used car buying experience are a highly evolved optimization for drawing people in with advertised prices while optimizing actual prices without driving buyers off. Carvana’s better buying experience is neither “opposite of” nor even orthogonal to their failure to optimize price, its a direct consequence of them deciding they didn’t need to.

[015a]

That's... not what anyone is saying. I bought an Audi from Carvana. It was more expensive than anyone else (~2-4% more). The price they paid for my trade-in wasn't as good as some competitors. I did not interact, in any way, with one of their vending machines. I'd still do it again.

It was a totally hands off experience; I will pay extra to not be talked to by someone. The checkout wizard was nearly as easy as buying something on Amazon. Which car? Enter your bank account number and social security. Agree to this loan rate. Sign over power of attorney so they can get your first year of registration and plates taken care of. They drive up to my apartment building; drop it off; "take it for a spin, I'll wait"; come back 30 minutes later; looks awesome; done.

I've taken that car to the local Audi dealer for service. They upsell you on everything. They pressure you. "Hey, while you're waiting, why not take this new 2022 A4 for a spin, no problem man my treat." "Yeah your car is in great shape; we could give you $15,000 for it right now, that'd take care of your down payment on this new one, its nice isn't it, don't worry about the monthly we can discuss that later" Just stop talking to me. I will pay so much more to not be talked to (and, really, compared to most dealers nowadays; its hard to say if Carvana is even "more expensive").

I feel extremely, EXTREMELY, confident in saying that this attitude has sold Teslas to three people in my bubble. You can start the process to buy a Tesla with Apple Pay. Seriously. Their new delivery process involves ZERO people; you drive to the store, the app tells you the ID of the car which corresponds to a piece of paper hanging in the windshield, you walk around the parking lot looking for it, if there are issues then people get involved; otherwise you drive away. That's it. I am buying a Tesla right now, even though I rather like the Mach E, because they make it so dangerously easy, and I have no clue how to buy a Ford. What's their delivery estimation? Is the price quoted on the site what I'll actually pay? Do I call someone? God, I gotta actually talk to someone? I gotta drive to the dealer? In person? Screw that, Tesla makes it easier, they get my $60,000.

Carvana made mistakes. But their model wasn't some VC abbaration like so many SV companies. They actually struck on something new, in an industry that needed that innovation, and that discovery has since (or maybe, in parallel) been applied by other companies in the industry. They screwed up, but I'll miss them.

[rsj_hn]

This is what I was saying before on here (and getting downvoted). Carvana's value add was selling used cars to people who don't like the experience of buying used cars. It's a good idea and someone else can take their place.

The problem with Carvana was that by offering auto loans to buyers as well as taking out loans to buy cars from sellers, they became excessively levered in a time of rising interest rates and falling demand for used cars. On the upswing they massively invested, thinking this was business success and not shocking leverage, and the downswing wiped them out.

Whoever the carvana replacement is going to be, they should subcontract out the business of offering auto loans and they should borrow less to fund acquisition of cars, because the auto business is cyclical and they need to be able to survive the downturns, which requires less rapid growth during the boom. But the overall business model can be fixed, even if Carvana can't.

[ghaff]

And going into a dealer with cash and buying a car at list price and taking the offer for a trade-in--all with minimal haggle--really isn't a terrible experience in general. I bought a new car over the summer which wasn't immediately available but otherwise was a pretty straightforward transaction.

The pain is that people get pulled into negotiations that mix in a bunch of different things (purchase price, trade-in, financing, add-ons) and it's all a bit more than they can comfortably afford.

[Karrot_Kream]

That's still a lot of work. If I have cash for MSRP why do I have to deal with "minimal haggle"? Can I not just buy the asset? There is definitely an audience of people who know what they want and how much they want to spend and Carvana is able to meet it. I think there's definitely more demand for effortless purchases than just CarMax.

I bought an electric car recently and only put up with the minimal haggle of an MSRP cash deal because I was on a sabbatical and had more time than usual. But my partner and I were ready to go for Carvana before my sabbatical or if we couldn't find a dealer willing to stay low-bullshit with us. I ended up calling 6 dealerships and asking my partner to clear her evening just for the one dealership that offered us a low-bullshit deal.

[listenallyall]

If you want to walk up to a dealer and announce that you have cash and want to pay full sticker, they will be happy to roll out a red carpet for you. But you still can't just "buy the asset." Local governments require all kinds of documentation and registration "bullshit" that it sounds like you are blaming the dealer for.

[ghaff]

In fairness, most car dealers are also setup for people who expect to be able to haggle, probably need financing, want to drive a car off the lot, etc. So the whole system just isn't set up for someone to basically go online, place an order, and wait to get told a delivery date.

There is a bit of a paperwork dance--also insurance--but, as you say, that's hard to eliminate totally.

[mardifoufs]

Not really. They will still try to upsell you tons and tons of features.

[ghaff]

>If I have cash for MSRP why do I have to deal with "minimal haggle"?

Because I want to save money? It literally took about 5 minutes to ask them to add the ~$1500 price of some factory-installed options to my trade-in price and they had a deal.

It wasn't completely frictionless but far and away the main hassle was just car availability. Had I been willing to take a similar vehicle they had on the lot it would have been quicker.

[Karrot_Kream]

Sure, I don't doubt that there's a market for people who want to save money. I'm saying there's probably enough demand for a low hassle car purchase at higher price points that CarMax won't be the only player in town. If my area can have 10 auto dealerships of a single manufacturer, I hesitate to think that only CarMax is able to absorb the demand of low-hassle purchase.

[015a]

I can't speak for how Carvana operates today, but when I bought my car years ago the loan was subcontracted through some unrelated financial provider (Go Financial, now Bridgecrest). I remember being kind of annoyed at this; that I wasn't just signing in to Carvana's website to pay. But, its fine.

I think Carvana did make mistakes; but I also think the industry as a whole is very deeply suffering right now. And we only hear about Carvana because they're a VC SV darling.

[ShredKazoo]

>Whoever the carvana replacement is going to be, they should subcontract out the business of offering auto loans and they should borrow less to fund acquisition of cars, because the auto business is cyclical and they need to be able to survive the downturns

Alternatively, could they hedge their exposure somehow?

[allthecybers]

> I feel extremely, EXTREMELY, confident in saying that this attitude has sold Teslas to three people in my bubble. You can start the process to buy a Tesla with Apple Pay. Seriously. Their new delivery process involves ZERO people;

My Tesla was ordered online (Apple Pay) and dropped off at my driveway. The only human interaction was the friendly Tesla delivery associate that had a couple papers for me to sign.

Audi, Volvo and Mercedes all had people trying to sell us last years model, adding packages we didn’t want or completely out of inventory on the vehicle we did want.

It’d be great if the Carvana sales model could be adjusted to market pricing, so the customer experience is the same but would be a profitable business.

[listenallyall]

I think this is only a fair comparison if you disclose the waiting time between ordering the Tesla vs delivery.

The Audi, Volvo and Mercedes dealers may have been directing you at sub-optimal cars, but they were available to drive off the lot that day. If you're willing to wait 3 months, you can certainly order the latest Audi or Mercedes model with the exact specs and options you want. You can even pick it up at the factory in Germany and take it for a spin on the Autobahn.

[FireBeyond]

> My Tesla was ordered online (Apple Pay) and dropped off at my driveway. The only human interaction was the friendly Tesla delivery associate that had a couple papers for me to sign.

Did you get to inspect the vehicle before you signed the papers? Have heard numerous stories about that, where people either don't get a chance to do so, or when they do find concerns, are pressured by the delivery associate to accept it, "and we'll fix things at the Service Center".

Similarly, my Audi dealer has never tried to run the numbers on trading my car in when I've been in for a service visit, and the only vehicles they've tried to put me in is a loaner vehicle if the service time will be 2 hours or more (and unlike Tesla, they -always- have a loaner for you, even if it's one from the lot).

[jjav]

> Enter your bank account number and social security.

Really? That would be a 100% show-stopper for me. They absolutely don't need to know such highly private information.

I'll stick with cragislist and paying cash, which is how I've bought every car I've bought in the last ~16 years.

[fragmede]

Don't worry, they don't really need your SSN to pull your credit report anymore.

[epa]

Oh no, talking to someone

[015a]

I love talking to people. I don't like being talked to.

[bombcar]

Remember the bad old days of having to dodge hordes of salesmen just to try to buy some computer parts?

[rippercushions]

No? But then again, I've always done my pre-Internet computer parts shopping at obscure specialist shops that are tucked away in semi-derelict shopping malls and are run by misanthropic neckbeards.

[dimmke]

I loved Carvana because I bought a car from them for about the same price I’d pay at a dealership but it was all online and I didn’t have to feel like I was getting swindled at any point.

The experience of buying a car at a dealership is a fucking nightmare. It’s awful. It’s the worst customer experience you can have in the United States.

There’s been some serious issues with the used car market fluctuating over COVID but it’s very reductive to now say “oh they were bad the whole time just another unprofitable unicorn”

[jrnichols]

I'm old enough to remember iMotors and how it too made the online car buying experience decent.

Carvana has done the same thing, 20 years later.

Car dealerships, for the most part, have not evolved at all or even tried. The experience is still a huge pain in the ass, and they know it.