PYMNTS-MonitorEdge-May-2024

Carvana Brings Same-Day Delivery to North Carolina 

For the third time this month, Carvana is expanding its same-day delivery program.

The online car seller announced in a news release Thursday (Aug. 30) that it would begin offering that service to select customers in North Carolina. 

“When we launched vehicle delivery in Charlotte almost 10 years ago, it was only the third market Carvana served,” Matt Dundas, Carvana’s senior director of finance, said in the release.

“Now, bringing same-day delivery to the greater Charlotte area feels like a full circle moment for Carvana as we raise the bar for local customers, including dozens in the area that have already gotten to enjoy the ease and convenience of same-day speed.”

The news follows last week’s announcement that the company was bringing same-day delivery to Indiana. The program debuted in Arizona earlier this month. Carvana says it plans to introduce it to new markets around the U.S. in the coming months.

“Carvana’s new same-day process means that customers can purchase from a wide selection of preowned vehicles, get prequalified and approved in as little as three minutes all online, and in a matter of hours, Carvana can drop off the new car and take the old one away if selling or trading it in,” the release said.

The expanded delivery service is happening at a moment when consumers are facing increasing pressure to find vehicles they can afford.

Recent data from Cox Automotive shows that the average U.S. car buyer now needs 42 weeks of income to pay off a new vehicle, compared to 33 weeks prior to the pandemic. The same numbers show the average used vehicle price coming in at $27,000, 30% higher than pre-COVID figures.

These numbers could explain why auto loan delinquencies are at their highest in nearly two decades even as the labor market remains solid, according to a Wall Street Journal (WSJ) report.

“Usually you get the default spikes when unemployment spikes — it’s the biggest correlation in consumer credit,” Clayton Triick, a fund manager at Angel Oak Capital Advisors, told WSJ earlier this month. “To see them go up that much while unemployment is still low is not typical.”

Carvana in July projected improved pricing and inventory conditions after seeing its sales plunge during the post-pandemic period.

Speaking during an earnings call, Carvana Founder and CEO Ernie Garcia pointed out that the company had been “positioned aggressively for growth” 18 months earlier.

PYMNTS-MonitorEdge-May-2024