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Carvana Adds Market, Partners with Credit Union

Carvana Adds Market, Partners with Credit Union Featured

Carvana is expanding both its physical locations and its finance connections.
The used-car chain recently expanded into St. Louis, the company’s first market in the state of Missouri. It is Carvana’s 24th market overall.
Carvana has also partnered with Northwest Federal Credit Union (NWFCU), a Virginia-based credit union with more than $3.1 billion in assets. The partnership will provide a completely online vehicle financing and purchasing solution to NWFCU members.
To celebrate the partnership, Carvana and the Northwest Federal Credit Union Foundation are giving away a car worth up to $15,000. The raffle will run from April 17 to June 11, and the winner will have the opportunity to choose a vehicle from Carvana’s inventory.

Last modified on Wednesday, 12 April 2017 23:16
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  • Vending Machines Prove Good Investment for Carvana

    Used-car chain Carvana is seeing strong growth thanks in part to its unique marketing, but also because of an old-fashioned basic of the business – financing.

    The Phoenix-based company is most famous for its so-called vending machines, vertical structures that house cars and use an automated system to bring them down to buyers.

    The first vending machine debuted in Nashville in 2015. Carvan now operates four total and plans on adding more as it moves into new markets.

    CEO Ernie Garcia said the vending machines are a great investment.

    “I think some of the brand assets, such as the vending machines, are a very important part of telling that story as well as establishing credibility because when you drive (and see) the big car vending machine, it gives you the sense that there is a real company underneath it,” Garcia said.

    However, the facilities also represent a fairly large investment.

    “It is the most operationally and capital-intensive thing that we do,” Garcia said.

    “It means acquiring a vending machine site, going out and finding a location, negotiating a deal with the land owner, going through entitlements with the city, and getting approved, and then physically building the space itself.”

    As Carvana grows, Garcia said word of its unique process is spreading. In addition to the unusual delivery method in some markets, Carvana conducts almost all of its transactions online.

    Garcia said new markets that are in close proximity to existing markets ramp up faster than totally new markets.

    National advertising on cable networks will play a large part in creating   awareness of what the company does to make these fresh markets grow faster, Garcia said.

    He said cable advertising makes sense as the company grows larger and that broadcast advertising will follow as it expands even more.

    In the end, financing matters more to most car buyers more than a cool delivery gimmick like the vending machines or ads on TV.

    Carvana is doing very well in this area, setting up financing for approximately 70 percent of its customers.

    Mark Jenkins, Carvana’s chief financial officer, said technology helps there, as well.

    “I think (that is) a number that’s enabled by the technology that we’ve built to provide a very seamless experience to customers who could very easily fill out a credit application form on their phone or desktop, and select from a wide variety of financing options that we make available in a very transparent way,” Jenkins said.

     

     

  • Carvana Keeps Growing

    Four years after selling its first car in Georgia, Carvana is adding another store.
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    Carvana launched in Atlanta in 2013.
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