<story><title>As Carvana crashes, used car dealers, not buyers, stand to win big</title><url>https://www.businessinsider.com/used-vehicle-retailer-carvana-bankruptcy-car-buyers-inventory-2022-12</url></story><parent_chain><item><author>hn_throwaway_99</author><text>I bought a used car from Carvana before the pandemic, and this is pretty sad news to me because after that purchase I vowed that all my future cars would come from Carvana. The buying experience was simply excellent for me, and I couldn&amp;#x27;t be happier with the car I bought. I figured I probably could have gotten a comparable deal slightly cheaper somewhere else, but I would have wasted a ton of time, and still would have crossed my fingers that I wasn&amp;#x27;t buying a lemon - any slight premium I paid to Carvana I felt was totally worth it.&lt;p&gt;I hope they can fix their financial issues (sounds like they just &amp;quot;bought high and are selling low&amp;quot;) and their operational issues (in some places word got out that it was cheaper to just &amp;quot;buy&amp;quot; a Carvana car and then return it &amp;lt; 7 days rather than getting a car rental), because, at least for me, their purchasing experience was great.</text></item></parent_chain><comment><author>phphphphp</author><text>The good experience you had early on and the bad state of the company now are closely linked.&lt;p&gt;The story is always the same with this type of company: take a mature industry that is profitable on a unit basis &lt;i&gt;because&lt;/i&gt; it’s boring and unpleasant, then build a narrative around some strategy to make it exciting (giant vending machines!) and get buy-in to spend huge amounts of money in pursuit of the narrative but eventually discover the only way to be profitable is to do what the mature industry players already discovered — but now you’ve got so much debt to service you have to cut even more corners and somehow manage to spend billions on becoming a worse version of what already existed and whatever goodwill you earned is burned.&lt;p&gt;There’s lots of room for businesses to improve on the boring legacy industries with low margins — like car buying and selling — but it requires careful iteration, it requires taking the established understanding and then building on it. Subsidising the cost of good-but-unprofitable service using investment dollars (Carvana was losing thousands per sale pre-pandemic) doesn’t build a sustainable business &lt;i&gt;unless&lt;/i&gt; it’s part of a strategy.</text></comment>
<story><title>As Carvana crashes, used car dealers, not buyers, stand to win big</title><url>https://www.businessinsider.com/used-vehicle-retailer-carvana-bankruptcy-car-buyers-inventory-2022-12</url></story><parent_chain><item><author>hn_throwaway_99</author><text>I bought a used car from Carvana before the pandemic, and this is pretty sad news to me because after that purchase I vowed that all my future cars would come from Carvana. The buying experience was simply excellent for me, and I couldn&amp;#x27;t be happier with the car I bought. I figured I probably could have gotten a comparable deal slightly cheaper somewhere else, but I would have wasted a ton of time, and still would have crossed my fingers that I wasn&amp;#x27;t buying a lemon - any slight premium I paid to Carvana I felt was totally worth it.&lt;p&gt;I hope they can fix their financial issues (sounds like they just &amp;quot;bought high and are selling low&amp;quot;) and their operational issues (in some places word got out that it was cheaper to just &amp;quot;buy&amp;quot; a Carvana car and then return it &amp;lt; 7 days rather than getting a car rental), because, at least for me, their purchasing experience was great.</text></item></parent_chain><comment><author>GekkePrutser</author><text>I wonder if it&amp;#x27;s possible for these concepts to really go big.&lt;p&gt;The problem is, there&amp;#x27;s a lot more lemons on the market then there&amp;#x27;s great deals. Nobody wants the car that doesn&amp;#x27;t start twice a week or that&amp;#x27;s been in an accident and has its chassis skewed.&lt;p&gt;These sites start out by promoting seller karma or something but even the best sellers have lemons to get rid of. At the start they probably just sell them elsewhere to keep their rating high. Eventually as these sites get so big you can&amp;#x27;t avoid them, the quality will inevitably drop because they capture too big of a market which just includes a lot of crap.&lt;p&gt;At the same time investors will want to see that exponentially skyrocketing line continuing so they&amp;#x27;ll be pushing to cut corners left right and center just as things get difficult.&lt;p&gt;I don&amp;#x27;t know Carvana as I don&amp;#x27;t drive much anymore but I assume the same story supplies here at least in some ways.</text></comment>