Carvana, the online used car selling platform that has made billionaires out of its founders, is also a little dubious because its valuation seems to depend, mostly, on its novelty. In a new report, The Wall Street Journal talked to some people for whom the Carvana experience went very, very wrong.
Now, every business has customers who have less-than-ideal experiences, so the fact that Carvana has had some, too, is not surprising. What is more eyebrow-raising is that, as the WSJ reports, Carvana has had more than double the number of complaints to the Better Business Bureau through September compared to rival CarMax, and that’s despite CarMax selling more than triple the number of cars than Carvana does.
A lot of the Carvana complaints seem to center on title transfers and registrations. Take this guy’s experience:
For Brian Thompson, a Carvana buyer in Michigan, the hassle of trying to troubleshoot with the company got to be too much, he said.
Mr. Thompson said he’d used Carvana last year and generally found the experience to be easy. It was his more recent purchase of a Lincoln MKZ in January that he said soured him on the company.
For months, he said, Carvana provided him with temporary registrations from Georgia, Tennessee and Arizona in lieu of registering his car in Michigan. He said it also didn’t provide a title, while Michigan state law requires buyers to title vehicles with the state within 15 days.
After several months of back and forth with Carvana, Mr. Thompson said he filed a complaint with the Michigan attorney general’s office.
He said he was soon called by a state investigator, who was interested in Carvana’s use of out-of-state temporary registrations.
In September, about eight months after his purchase, Mr. Thompson received plates and the title for his car, which by then he wanted to sell.
“I loved the car, but I hated the experience so much I didn’t want it anymore,” he said. “It was horrible.”
The WSJ also talked to another guy who said that he had negotiated the sale of his Chrysler Pacifica to Carvana, only for Carvana to deposit less money than they had agreed in his bank account and take his Pacifica anyway. That situation was only remedied after several conversations with Carvana customer service. A third person the WSJ talked to is still waiting on the title for a Hyundai Sonata she bought from Carvana almost a year ago and has been unable to register the car because of that since then.
It seems that Carvana, as with any startup that pretends to reinvent old industries, is suffering from some of the same problems as the system it is trying to replace. The old system, of course, had some low-tech solutions for things like title issues.
“In my world, if there’s a title issue, they call once or twice,” said Brian Kramer, general manager of Germain Toyota of Naples, Fla. “Then, they’re standing outside my office, staring at me until I get off the phone.”
I can confirm that the power of I’m-not-leaving-until-you-do-something-about-this at dealerships is strong.