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Carvana stock went down another ~14%. Which means in the last few days it’s gone down ~52% (update, 63% as of 11/8). Not good for Carvana. But what does that mean for car enthusiasts? 

Well since this whole post corona economic insanity has been going on, Carvana has been buying trade-in vehicles for more than they’re worth. Perhaps recklessly? They were doing it to try & seize/own the market. The difference is: Carvana is national. So where the larger local dealerships in your community might have a few hundred used cars on the lot to deal with. Carvana was buying A LOT more vehicles across the country at inflated prices. They took a good bit of marketshare, with the pitch of “We’ll give you more for your trade-in.” That forced local dealerships to compete… and the price of used cars went up across the board. Of course with the new car chip/inventory shortages, there were additional factors at play as well. But now – the chickens are coming home to roost… or whatever the hell that phrase is. 

The stimulus checks have ended, interest rates have soared, and inflation is through the roof. And now – Carvana’s huge nationwide inventory of used cars are no longer worth the premium that Carvana paid for them. 

buy car online

Carvana’s stock plummeting…

Could very-well be the catalyst to ‘crash’ the car market and bring it back down to earth. I don’t know what’s gonna happen with Carvana specifically. But the longer they have to sit on their vehicles, the worse it gets. Carvana will ultimately have to move these cars, even if it’s at a loss. But what this will do – is help bring car values back down to a more normal level. 

The interest rates are still high, but if you give it time & hold out a bit longer, they should come down. The dealerships will have to hurt for a while before they do. All the repos on upside-down auto loans are gonna hurt too. But if you’ve been holding-out on buying a car due to all this mess… your time is coming. Just keep being patient. 

carvana sales

One final point…

There’s a big difference between online sales & salespeople. I know dealerships aren’t popular right now at all… and I get that. But physical dealerships have real salespeople that generate sales. The internet just offers cars for sale. Big difference. On a site like Carvana, you can simply close the tab, and come back to it… or most likely not. Especially when you’re browsing for a boring/generic cars that are available by the thousands & no particular one ever stands out.

Millennials (like the ones in these photos) love the idea of no pressure. But hell – sometimes your ass needs a little pressure lol. ‘No pressure’ is why you’re still living with your parents. Low blow? My bad, that wasn’t the intent. But I am pretty convinced there’s been a few cars on Carvana… that had they been at a local reputable dealer… I’d have driven to see them & maybe made a move. But instead I closed the tab & they quickly fizzled. 

We’re gonna see how all this plays out, now that car dealerships have to actually start selling cars again without the all the cards stacked in their favor. Cards like 1) high demand, 2) low inventory, 3) make-believe money, and 4) low interest rates. 

buying car carvana

In the modern consumer landscape, we’re constantly being urged to buy online…

But 9x-out-of-10, the online version of whatever it’s replacing… is just lesser all around in the longterm. The pitch is always 1) a cheaper price, 2) cutting out middlemen, and/or 3) not having to ‘deal with’ people. But the reality is usually 1) less quality, 2) less true professionalism, 3) less customer service, 4) data-collection, and 5) corporations that become too powerful for anyone’s good. They’re conditioning us that interacting with people is a hassle.

Well shit guys – at this point I wouldn’t mind going back in time a bit… and bringing our world more locally-centered with real people in our real community. I want to go to the freaking market for food; I want to go to the boot store for boots. I want to buy from the people I share my community with. Enough of this stuff. I’m tired of the Carvana type of business model, I’m tired of the Zillows, and I’m tired of the Amazons. I can appreciate that fact that various forms of competition keeps everyone on their toes & at their best. But can we prioritize our community a little bit?

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