Fad or not, Carvana has made a major impact in the automotive industry, committing market share robbery from the multitude of used car retailers nationwide.
In its Full Year 2019 performance news release and Letter to Shareholders, Carvana reported:
- Retail Units Sold of 177,549 vehicles, an 89% increase YoY
- Increase in vehicles purchased from customers by 231% YoY
- Earnings of $3.94 billion in revenue, a 101% increase YoY
- Fastest organic growth of any automotive retailer in U.S. history (+83,441 retail units)
This young company is no longer a speck on the map. If Carvana continues to perform as they have, they will surpass all other used car retailers like Off-Lease and Texas Direct and start cutting into the traditional retailers used car market share and most importantly – profitability.
In North Carolina, Cross-Sell data reveals that this has already happened in the Raleigh market to Capitol Ford and Hendrick Toyota. These franchised dealers lost 306 and 141 used vehicles in 2018 respectively. In March of 2019, Carvana passed Capitol Ford in used car vehicle sales for the first time. And by the end of 2019 they crept into the top three of North Carolina’s highest selling automotive retailers.
2017 – Raleigh, NC Market
Carvana doesn’t appear among the top ten sellers.
2018 – Raleigh, NC Market
Carvana makes its debut! Claiming Used sales from traditional retailers like Capital Ford and Fred Anderson Toyota, and forcing others to remain stagnant in market share.
2019 – All of North Carolina
As a holistic view, Carvana-Raleigh is leap-frogging dealerships across the state, and securing the #3 spot of Top Selling Retailers in North Carolina. All while Carvana-Charlotte creeps into the #9 spot during the second half of the year.
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This is only one example. Many states are seeing similar trends with Carvana fiercely breaking into their biggest markets with significant quarterly growth. Whether traditional retailers are fans or foes of the Carvana business model – it’s time to take note of their growth and the strategies that are working for them in order to compete with them in 2020.
Learn more about Cross-Sell data and how you can keep a close eye on your market, here.