Carvana in Government Crosshairs After Increased Complaints

Carvana customers have filed dozens of complaints with local officials and hundreds more with the Better Business Bureau related to wrong paperwork, delays getting their vehicle’s documentation and other issues with the nine-year-old online auto retailer, The Wall Street Journal reported Friday (Oct. 22).

The online car retailer is on probation in Michigan after it violated state laws, including some related to transfer of titles and registrations, the news outlet reported, and has been fined $10,500 in Texas for issues related to paperwork.

Carvana was suspended in August for six months from selling cars at its Raleigh, N.C., dealership because it broke the state’s dealer licensing laws, and another location was put on probation for more than a year. The company paid $850,000 to four counties in California in a civil lawsuit when Carvana sold and transported cars without the proper licenses.

A Carvana spokeswoman said the company is focused on getting better in all areas. She did not comment on specific fines or penalties or customer complaints.

The Better Business Bureau fielded 899 complaints from Carvana shoppers this year through the end of September, more than double the 411 issues reported to the BBB with CarMax. Carvana customers have also filed dozens of complaints with officials in Ohio, Texas, Georgia and North Carolina.

Carvana Chief Executive Ernie Garcia III told the WSJ in August that the retailer’s efforts to buy more cars have translated into insufficient manpower and resources, which has caused longer delivery times and registration delays.

Related: Carvana Revenue Up 200 Pct As Used Cars Remain Hot

Meanwhile, Carvana’s revenue went up almost 200% in the second quarter of 2021 from the same time a year ago, and the firm sold more than 100,000 vehicles for the first time, a 96% increase from a year earlier.

Carvana opened its 13th inspection and reconditioning center near Cleveland in the second quarter of 2021, bringing the company’s annual production capacity to 750,000 units and added 27 markets to its coverage map.

The company is planning to open eight more inspection and reconditioning centers by the end of 2022, bringing its total capacity to 1.25 million units. WSJ reported that the company plans to hire around 5,000 new employees.