No Break For Carvana, the ‘Amazon of Used Cars’

Concerns are mounting around Carvana, the “Amazon of used cars.” 

The online car retailer was an investor darling during the pandemic. They hailed the new economy that wanted consumers to buy everything online: groceries, office equipments, travel tickets, meals, clothes, homes and cars. 

Carvana  (CVNA) – Get Free Report was a pioneer in the new way of buying and selling vehicles with its model of car vending machines. 

The group also benefited from disruptions to vehicle manufacturers’ supply chains, which had caused a large imbalance between supply and demand for cars at the expense of supply. As a result, car prices had jumped sharply, so that the prices of used vehicles were competitive with those of new vehicles. Interest rates were also close to zero, which had a double advantage for Carvana. It was easy to finance the purchase of a vehicle for consumers and Carvana could also tap into the debt market to finance its expansion. The company thus went into debt five times during the pandemic.

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