The used car market is still topsy-turvy, prices are still at all-time highs, and there aren’t many signs of the trend slowing down any time soon. National online-heavy car sales franchises like Carmax and Carvana are ever-popular despite exceptionally high transaction rates, and it looks like General Motors (GM) wants to get in on that action.
Welcome to Headlight. This is a daily news feature that lights up one current event in the car world and breaks it down by three simple subheadings: What Happened, Why It Matters, and What To Look For Next. Look for it in the morning (Eastern time) every weekday.
What Happened?
General Motors announced its intention to get into the used car business via a brand-new online shopping platform called CarBravo. Inventories will be based on participating Buick, Chevrolet, and GMC dealers, while Cadillac is planning a separate platform.
The website will run similar to Carmax or Carvana. The cars will be purchased, inspected, and reconditioned “to meet standards set by GM.” GM says that CarBravo will dole out guaranteed online offers, even if they don’t buy the vehicle through CarBravo. The vehicles will include a warranty that can be serviced at participating Buick, Chevy, and GMC dealerships.
Why It Matters
The industry might be on the cusp of a fundamental shift in how cars, both used and new, are bought and sold. Recently, Autocar reported a rumor that Toyota plans to initiate factory reconditioning for used vehicles. Ford partnered with Autotrader for the Ford Blue Advantage used car tool. The point is, the traditional brick-and-mortar relationship between a customer viewing a car in person, versus shopping online and buying, may not be as pertinent as once thought.
Still, not everyone is convinced that an entirely online sales experience is the way to go. On social media platforms like TikTok and Facebook, there are tons of stories and comments from dissatisfied customers who’ve felt bamboozled or cheated by Carmax, Carvana, or other online-only dealership experiences.
However, GM has a legacy of more than a hundred years of experience in managing dealerships and service departments. That network of dealers and its relationships with other companies like XM Radio (all CarBravo vehicles will come with an XM Radio trial if possible), could give an edge over Carmax, Carvana, or others. If GM plays its cards right, it could persuade other OEM’s to try their hands at the used car game.
What To Expect Next
Expect GM to push the heck out of its CarBravo service. It announced that dealers can enroll immediately, and GM plans to start marketing the platform in February.
If this works, it could be the start of something big in the dealership sales model. Currently, some states like Michigan have flat out outlawed direct manufacturer-to-customer sales. But, with GM directly managing used-car sales from the corporate tower, that could compel legacy manufacturers and lawmakers alike to reconsider the idea of direct sales.
What to read next:
- Car Autance launched a new series, Car Confessions and Hard Lessons. In the second installment, Matt Farah explains why ignoring his own advice on a vintage Ferrari cost him $10,000.
- Kevin Williams explains why his Mazda 3’s sticky melted dashboard left him infuriated with technical service bulletins.
- VinFast is looking to enter the U.S. market, and the upstart Vietnamese automaker might be using an old Ford playbook to grab your attention.
- This $1,902,000 Porsche is now the most expensive car ever sold on Bring-a-Trailer. Can you guess what it was?
- Toyota got the Initial D creator to illustrate a GR86 commercial, and it’s pretty incredible as far as advertisements go.
