Carvana new sales strategy turns dealership into ‘playground’

Key Points:

• Carvana is expanding its online vehicle sales model to include new cars and trucks through its acquisition of seven Stellantis franchised dealerships, using them primarily as service centers and test-drive locations rather than traditional sales outlets.
• The company emphasizes an entirely online purchasing process for both new and used vehicles, with customers able to customize, test-drive, and buy vehicles through Carvana's digital platform, supported by physical "playground" locations designed for a self-guided experience.
• Carvana's new vehicle inventory is limited compared to traditional dealerships, with about 3,000 new vehicles nationwide versus over 60,000 used, which may result in customers test-driving similar but not identical models to their purchase choice.
• The service departments at Carvana's franchised dealerships will operate traditionally but with Carvana's focus on transparent pricing and hassle-free customer experience, while financing remains primarily through Carvana itself, with potential future integration of leasing or Stellantis financial services.
• Carvana's strategy aims to grow market share and support used vehicle sales through trade-ins, potentially disrupting the traditional U.S. franchised dealership model, though the company is currently focused on refining its approach before expanding further.