online car buying

Is the Online Car Buying Model Dead?

The end of 2022 wasn’t the best year for Carvana, an online used car retailer based in Arizona. Yahoo Finance called Carvana “Worst Company of the Year” after polling more than 5,000 readers. The online car-buying company also has concerns over its debt load, and had its stocks drop by 98 percent. 

So is Carvana going out of business? With numbers like this, it’s hard to know what the future holds. But one thing is likely to stay the same: online car buying. 

Online vs In-Person Car Buying 

Carvana and other online car buying platforms like Vroom and CarMax offer car shoppers a pretty great way to shop for vehicles. Instead of going to the dealership, negotiating with a salesperson and spending hours waiting for paperwork and financing to go through, car buyers can handle the entire transaction online. 

While some people still prefer the in-person shopping experience – being able to actually see and test drive a vehicle – there’s enough people who prefer to do their car shopping online. This will likely keep the online car buying model alive and well. That being said, this can be an expensive business model. 

Why Online Car Buying is Likely to Change

From a business standpoint, the online car buying business is expensive and labor intensive. It takes time and costs money to locate and buy used cars, recondition them, market them on the website and deliver them to the customer. There’s also paperwork to process – it’s all a big expense! And this is where Carvana has struggled. 

According to sources, Carvana has delivered vehicles to buyers in less-than-desirable shape, causing them to have to pay for repairs. These sources have agreed that Carvana has great customer service, but paying for repairs at dealerships is expensive. It has also been reported that Carvana pays top dollar for their vehicles – sometimes tens of thousands of dollars. 

At the start of the pandemic, Carvana had the upper hand. They were able to meet customer demands, especially compared to dealerships that were struggling with parts shortages and COVID-related factory shutdowns. But things quickly changed as the paperwork piled up, cars weren’t getting registered and cars were being delivered in satisfactory condition. 

As a result, Carvana’s dealer license has been suspended in some states. 

What is the Future for Online Car Buying? 

Even though online car buying is a popular service, the business model may not be sustainable. CarMax is in better shape to survive because they have online and physical dealerships that allow customers to make transactions in person. They also have a one-price model so there’s no haggling. 

If you like online car shopping, consider We provide online car buying for repossessed cars. We include detailed images of each vehicle, along with information such as the condition of the vehicle, its vin number and its features. Our business model is sustainable because we provide a list of the banks and credit unions in each state that are selling their repo inventory.

Enjoy the best of both worlds – the convenience of online car buying and used vehicles at great prices!