Anyone listing their inventory on Carvana?

[Greg Spencer]

A year ago, I wrote an article about Carvana's experiments with third-party listings. https://aimgroup.com/2020/08/14/carvana-enters-into-marketplace-territory/

Carvana was listing cars from other dealers, and selling them as their own. Sort-of. The dealers who owned the cars weren't named. In fact, in the photos, dealer signs and logos would be Photoshopped out. But the cars would be marked as "partner inventory" and a disclaimer would warn shoppers that the cars weren't in Carvana's possession and that they would have to be purchased from the third party.

A year later the experiment remains an experiment. Carvana discussed it very briefly in their Q2 earnings call, but didn't divulge anything about it other than that the experiment continues. What do you suppose is holding up this project?

 

[Alex Snyder]

@Todd Caputo was using this at one time.

 

[Ryan Everson]

@Todd Caputo was using this at one time.

This is RocketAuto.com's entire business model - partnering with third-party dealers:

Rocket Auto | Car Buying Made Simple

Find the perfect car or truck. Thousands of vehicles. One marketplace.

www.rocketauto.com

 

[Ryan Everson]

Fair (started by TrueCar founder Scott Painter) is also moving to this model:

Stewart said expanding Fair would be difficult because the demand for used-vehicle subscriptions and leasing products is limited compared with demand for cash or financed vehicle purchases. He added that some loan terms and new-vehicle leases also are cost-competitive for some consumers, and a short-term vehicle subscription comes with higher costs.

Fair's brand and technology instead can serve a marketplace model that facilitates a vehicle transaction between consumers and dealerships without carrying the risk on the company's balance sheet, he said.

The company's model, he said, would be analogous to "either Carvana without owning the cars, or think of it as Autotrader where you can purchase the car and have all of the things that go along with it — insurance and F&I products and logistics — facilitated by that platform. In this case, us."

Stewart said Fair would handle an entire digital transaction, including finance and insurance and paperwork. Partnering dealerships would arrange test drives, trade-ins and vehicle delivery as well as longer-term service needs, he said. Consumers would transact digitally from Fair, which would purchase the vehicle in a wholesale transaction from the dealership and sell it directly to the buyer without holding it long term on the company's books, he said.

Fair ends subscription, leasing program in pivot to marketplace model

The Santa Monica, Calif.-based company plans to relaunch as a digital vehicle marketplace in early 2022, with the first quarter as a goal.

www.autonews.com

 

[Greg Spencer]

This is RocketAuto.com's entire business model - partnering with third-party dealers:

Rocket Auto | Car Buying Made Simple

Find the perfect car or truck. Thousands of vehicles. One marketplace.

www.rocketauto.com

Yes, but in contrast to Carvana, RocketAuto discloses who the third parties are. RocketAuto says it will enable online purchase on its own platform, but it will also offer a more traditional transaction where part of the deal's worked out on RocketAuto, but the final purchase is done at the dealership. At least from what I could work out.

 

[Ryan Everson]

Yes, but in contrast to Carvana, RocketAuto discloses who the third parties are. RocketAuto says it will enable online purchase on its own platform, but it will also offer a more traditional transaction where part of the deal's worked out on RocketAuto, but the final purchase is done at the dealership. At least from what I could work out.

Correct! Rocket Auto has a BDC in Detroit (that currently powers Vroom) that I'm assuming will handle all follow-up communication and pass the near finalized deal/lead along to the dealer partner to wrap up and deliver.

 

[Greg Spencer]

Fair (started by TrueCar founder Scott Painter) is also moving to this model:

Fair ends subscription, leasing program in pivot to marketplace model

The Santa Monica, Calif.-based company plans to relaunch as a digital vehicle marketplace in early 2022, with the first quarter as a goal.

www.autonews.com

Wow. That's a big pivot. If Fair's new CEO can salvage that business, he'll be a hero.

 

[Shawn Zents]

Interesting, this was posted just 2 days ago:

Brian Benstock on LinkedIn: #brianbenstock #frictionless #carvana #inventory #strategy… | 51 comments

❌ Do not be fooled by this strategy ❌ There are platforms out there that are looking to list dealers inventory in order to help dealers sell their… | 51 comments on LinkedIn

www.linkedin.com

 

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[Alex Snyder]

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