General Motors Co announced the launch of CarBravo, an online used vehicle marketplace that will allow the manufacturer and its dealers to compete with Carvana Co, CarMax Inc, and other companies that benefit from the sale of used automobiles.
CarBravo, GM’s consumer financing arm, will combine automobiles owned by Chevrolet, Buick, and GMC dealers, as well as cars and trucks that GM Financial, the automaker’s consumer finance arm, controls after returning them from rental car agencies or vehicle leases. According to GM officials, the company’s dealers have approximately 400,000 used automobiles on hand.
CarBravo will allow customers to look at inventories from both dealers and GM’s central stock of used vehicles, as well as non-GM used vehicles, according to Steve Carlisle, GM’s EVP and president of GM North America. That might help it compete more effectively with Carvana (which just claimed it had sold one million automobiles) and other sites like CarMax and Vroom, which allow customers to search for cars from a variety of manufacturers.
Due to a lack of new inventory and supply-chain constraints, the price of secondhand cars has risen throughout the pandemic.
Carvana, a $34 billion online used-car marketplace, filled the e-commerce gap left by automakers and most traditional dealers, allowing customers to shop for a wide choice of used vehicles from numerous brands and have them delivered to their home. To challenge Carvana, GM is teaming up with car retail chains like AutoNation to launch online used vehicle marketplaces. Carvana’s stock has dropped over 50% from its 52-week high.
The development of direct-to-consumer firms like Tesla and Lucid has put the old dealership / franchise system on the defensive, so CarBravo could be a method for GM to test the waters. However, the business has struggled with investments like its Maven car-sharing programme, so we’ll have to wait and see if CarBravo can beat out some of the more well-known online used-car destinations.
Carvana did not directly address GM’s plan in a statement released on Tuesday, but it did emphasise that it “pioneered online car buying” and has purchased and sold over 1 million vehicles.
“While we are still learning about the newly announced service from GM, what they have set out to do is difficult,” CarMax Chief Marketing Officer Jim Lyski said in a statement.