June 19, 2026 - Carvana Tries New Car Sales

This is the Telemetry Transportation Daily for June 19, 2026, and I'm Sam Abuelsamid, Vice President of Market Research for Telemetry. 

Over the last 30 years, there has been some innovation in the used vehicle retail sector, mostly having to do with achieving scale to give customers more choice and after-sales support while improving profitability.  The two biggest companies in this space were CarMax and AutoNation, both of which opened national chains of used vehicle superstores. AutoNation eventually began acquiring new vehicle dealers as well and is now one of the largest new vehicle retail groups in the U.S. 

More recently, Carvana stepped into the used vehicle space in 2012 and heavily leveraged the internet to build its business. In addition to its retail locations with their iconic car vending machine towers, shoppers can go to the company's site, find a car they want, complete the entire purchase process online, and have the car delivered to their location from anywhere in the U.S. Similarly, anyone looking to sell a vehicle can get an instant online quote and a truck will come pick it up and hand over a check. 

During the early 2020s, as vehicle supplies dried up due to supply chain issues, Carvana grew rapidly, largely by overpaying for used car inventory, which almost led to the company's collapse. However, Carvana has recovered and is now following Autonation by getting into new vehicle sales. Carvana has already acquired at least seven Stellantis dealers and may end up acquiring other brand franchises as well. The big change with the Carvana ownership is applying the e-commerce sales model to new vehicle sales. Automakers aren't allowed to compete with their franchised dealers, and few dealers have adopted the fully online sales model used by startups like Tesla and Rivian. However, as a franchisee, Carvana is doing exactly that, which may be the best compromise for customers looking to avoid the hated new vehicle purchase process of being bounced between sales reps, managers, and finance and insurance. Customers can go into the dealership to check out cars and do test drives, but the purchase or trade-in is handled entirely online. It will be interesting to see how successful Carvana is in drawing new vehicle buyers and if it forces the rest of the dealer community to adopt a similar approach. 

Thanks for listening.