The new and used car market is crazy right now. The shortage of new vehicle inventory is driving up the value of used cars, as dealers seek inventory at any cost. Most of this is due to the semiconductor supply chain shortage I covered in the article, Semiconductor Shortage: Cause and Effect. The low supply/high demand makes this a great time to sell your car, but a challenge to buy a replacement.
I love a good automotive challenge, so I pulled the lever and sold my 2016 MINI Cooper to Carvana. Am I crazy? Once you hear my story, you may be jumping on my bandwagon.
Selling Your Car
The move to online vehicle selling and buying accelerated as a result of the pandemic. Local dealers and online retailers like Carvana and Vroom benefitted from online processes that kept shoppers safe.
With demand for new and newer used cars at record highs, it also opened the door for current vehicle owners to shop their car to multiple sources in order to find the best offer.
How and Where to Sell?
For the past few months, I got caught up in the idea of replacing one of my cars. I had my MINI for fun motoring and a 2004 Honda CRV (the one I chronicled in the article Honda CRV Color Change) for winter driving and Lowe’s runs. My son, Will, bought the CRV when he moved back to Michigan, so that left me with the fun car only. My wife has a MINI Countryman that she will not let me sell. She loves that car and has been very clear it stays until the wheels fall off.
I was curious what offer I might get for my MINI. Even though it is a 2016 model, it only has 35,000 miles. Carvana has a reputation for buying the market right now, so I tried them first, then cross-shopped other sources. Here are the results of all of the sources I tried to compare with Carvana:
Since I bought three MINIs from the local MINI retailer over the past four years, I thought I would give them a shot. They are very low on inventory, so figured they would place the best value on a car that supports their brand. Their offer was “$MINI” (I’ll use this variable as my baseline for comparison purposes). As you will see, theirs was the weakest offer. Pass.
Similar to Carvana, Vroom is online only–no brick and mortar stores. I completed their online form HERE, and received an offer of $MINI + $1,000 ($1,000 more than the MINI Retailer).
Better than the MINI Retailer, but still not the best.
Most of you know Kelley Blue Book for their used car value guide. They also help participating dealers buy local inventory through their “Sell Your Car” app on their website.
I completed the form and submitted it for their review. I received an instant offer of $MINI + $3,000. That also caused three local dealers to call me to buy my car. All wanted me to come in for a full appraisal. While I appreciate why they do that, other companies did not require that step. I kept it in mind as I went to my final source, Carvana.
Carmax is a used car retailer that was founded in 1993 and developed by Circuit City executives. They operate about 230 stores across the U.S. and offer online retailing as well.
Using the form on their Sell/Trade page of their website, you can provide the info on your car and get an instant offer. I did that and received an instant offer that was $MINI + $3,600.
While this offer was in the running with Carvana, it did require that I turn the vehicle in to one of their stores. For me, the closest one is two hours away. Not convenient.
I will skip to the end of the story and say that Carvana is everything they advertise. Theirs is the easiest, hassle -free process that I felt comfortable completing.
Over the course of about three months, I kept submitting my info to get a new offer. In the beginning, their offer was good for seven days. After submitting a new request about every 10 days, they extended the offer for 30 days. I think they were on to me!
I watched the offer increase over those three months, then drop by $300 with the last offer. I suspect the additional miles on my car from each submission plus the model year change likely led to this decline. I decided to go with the recent offer, which was $MINI + $5,000. At that price, I was able to drive my MINI for 2.5 years at no cost. No brainer.
Once I accepted the Carvana offer, I had to submit a picture of my driver’s license and the vehicle title. Within two hours, they approved the documents and allowed me to schedule the transaction date online. I made the selection, then waited for my day to come.
Note: I did not have a lien on my car, which enabled this process to move rather quickly. If you have an outstanding loan, they will work with you to pay off that loan. If you have a lease, you may be out of luck, depending on the lease source.
On the day of the appointment, someone from Carvana Marketing Operations came to my house. She was 20 minutes early, which I appreciated. She performed her inspection of my car, took pictures, then I completed the paperwork and received my check.
The total time spent at my house was 25 minutes.
I expected the Carvana team member was going to load my car on one of their fancy flatbed trucks and drive away with me waving my check in my hand. With the large number of cars they are buying right now, they called for a tow truck to pick up my car within the next 72 hours.
This all took place yesterday, so the MINI is still sitting in my driveway waiting to be picked up. The keys are secured in a lockbox and the car is clearly labeled as Carvana property. More importantly, the check is in the bank!
It should be noted that your experience may vary due to the vehicle you are selling. It depends on what kind of vehicle is in most demand for the dealer or buyer you contact. I have a friend who got a better offer from Vroom than any other for a Ford F-150. This is why you need to check multiple sources when selling your car.
Plans for the Future
Now that my winter/utility vehicle is gone and my fun car just sold, I am carless for the first time since I turned in my company car when I retired from GM in 2016. That’s OK, because I love the process of shopping and buying cars.
To replace the 2004 Honda CRV, I ordered a new vehicle from a local dealer. He was the only one who was NOT charging a premium for a new car. I tried different brand dealers in my area and all were charging $5,000 + over sticker for their cars. My vehicle should be built and delivered by early December. I’ll share more about that once it gets built.
With the “utility” vehicle handled, I am also shopping for my next fun car. This time around, I am considering a rear-drive sports car (likely a convertible). I’ve got a couple of cars in mind, and will also let you know how that goes another time.