[USER=4532]@Todd Caputo[/USER], I find EchoPark's biz model to be the most disruptive in the Indie Dealer space. EchoPark is a profitless frontend dealership. IOW, it sells cars at cost and all buyers are required to finance thru them. Think printers & ink.
If you think price sells cars, look at the advantage EchoPark has on the market. Using Cargurus deals box, compare Carvana vs EchoPark in dallas tx.
I'll not label the 2 boxes, do you see what I see?
[ATTACH=full]5189[/ATTACH][ATTACH=full]5190[/ATTACH]
If you believe price generates ups and sells cars, look at the ratios of the 2 stores.
- EchoPark (left) has 74% of its inventory in Good or Great Deal buckets
- Carvana (right) has 13% of its inventory in Good or Great Deal buckets
Another example, [USER=648]@Dan Sayer[/USER]'s Anderson Ford of Grand Island has 12% of its inventory in Good or Great Deal buckets
[ATTACH=full]5191[/ATTACH]
Similar to Carvana, EchoPark uses the car as a tool to generate F&I income, but, clearly, EchoPark is far more aggressive at using $0 front end as it's weapon of disruption.
Don't think EchoPark is a viable biz model?
- Read Sonic Auto's 10k and 10q's, EchoPark's $0 frontend, $2k backend multiplied by it's super fast turns are generating more profits than the traditional stores.
- See its reviews. 4.5 stars.
So, if your EchoPark, you can
- pay more at acquisition and not care (auction/street-buy/trade).
- payless for ad traffic because your killing all dealers on price sensitive marketplaces like CarGurus
Carvana gets all the attention, but EchoPark is the biggest threat.
Hope this helps...
-Uncle Joe
Carvana Dallas https://www.cargurus.com/Cars/m-Carvana-sp375400
EchoPark Houston https://www.cargurus.com/Cars/m-EchoPark-Automotive-Houston-sp415965
Anderson Ford https://www.cargurus.com/Cars/m-Anderson-Ford-Lincoln-of-Grand-Island-sp376385
