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Is Carvana Legit? Pros, Cons, & Unbiased Thoughts Explained

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Buying a new car can be a pricey endeavor, as brand-new car prices increased by up to 4.2%, compared to last year.

Luckily, you can always opt for a used car to save a lot of money in the process.

If you want to skip the hassle of going to a traditional car dealership, an online option like Carvana can be a nice alternative. But, is Carvana legit?

In today’s article, we’ll walk you through a comprehensive Carvana review with everything you need to know about it!

What Is Carvana?

Before diving into the juicy details of the review, let’s start by having a brief overview of Carvana. This will help you find out more about the company’s history and what it offers to its customers.

Carvana is a retailer that specializes in selling used cars online. The company was founded by Ernest Garcia III (the current CEO), Ryan Keeton, and Ben Huston in 2012. Carvana’s headquarters remained in Tempe, Arizona since its inception.

screenshot of the Carvana homepage - header graphic for the post about "is Carvana legit" on gigworker.com

As a startup, Carvana received multiple funding from investors, especially DriveTime. This allowed the company to invest in multi-story car vending machines. The company opened its first machine in 2015 in Nashville, Tennessee.

Today, it has more than 38 vending machines all over the country, according to the official Carvana website.

The signature car vending machine allowed Carvana’s popularity to skyrocket. In fact, the 2021 Fortune 500 list included Carvana despite being in the market for only 9 years by then!

In 2017, the company filed an IPO and joined the New York Stock Exchange under the ticker symbol CVNA.

According to the latest reports by Zippia, Carvana has around 10,400 employees all over the United States.

In 2022, Zippia reported Carvana’s revenue to be around $13.6 billion from car sales, marking a growth rate of 6.17% from the previous year, following a whopping 129.35% growth rate from 2020!

How Does Carvana Work?

The car buying process with Carvana is straightforward. First, you start by browsing Carvana’s huge collection of vehicles, which has over 25,000 cars.

You can even use advanced tools to filter the options based on your budget or other choices. Once you find the vehicle you’re looking for, you can call dibs on the car by holding it off the market for 30 minutes.

After completing your purchase, Carvana will ship the car to your location through one of its trucks.

This delivery option is only possible if you live in an area where Carvana has a local market, which is over 100, as of 2020. If you pick up the car from a vending machine, you won’t have to worry about the delivery fee.

In addition to selling cars with profits, it also earns extra money by charging Carvana car buyers interest on financing options.

Common Questions to Understand

In the following sections, we’ll walk you through more details about Carvana and whether it’s a legitimate car dealership. But first, let’s have a quick look at some of the common questions that many people wonder about before dealing with the company.

Is It Legal to Buy a Car Through Carvana?

The short answer to this question is yes. Carvana is a perfectly legal car dealer that provides almost all the services you should expect from traditional car dealerships. The only difference here is that it provides this service online rather than through physical stores.

The company is an ensured dealer that holds a proper license in almost all US states, except Michigan. This happened following the state suspending the company’s sale license under claims of being a harm to the public.

However, The company managed to sell over 1 million vehicles from 2012 to 2022. Carvana also offers a variety of financing options for qualified buyers. This makes the purchase process a lot easier.

Is Carvana Going Out of Business?

Although Carvana is not technically bankrupt, the company has been going through financial troubles over the last few months. According to a report by Forbes, the company is on the brink of bankruptcy since its stock dropped by more than 98% since its peak in 2021.

Not only that, but the company also recorded a massive net loss of over $2.9 billion in 2022. Carvana is also facing fierce competition with other online dealers, which upped their challenge to capitalize on Carvana’s recent struggles.

The pile-up of debt forced the company to lay off over 4,000 employees in 2022. As a result, Carvana announced that it will close multiple locations and slow down its expansion plans to focus on improving its margins.

Despite all that, it’s still fairly early to say whether Carvana is going bankrupt, especially when the company is aware of the situation and is implementing plans to curb its losses and improve its financial situation.

After all, with proper management and the company’s unique business model, Carvana still has a chance to turn things around in the next few years.

Is Carvana Legit?

Despite the recent financial troubles, Carvana is still a perfectly legal and legitimate business. The company allows users to browse through thousands of used cars and buy them with plenty of financing options.

Carvana is also a great alternative for anyone who wants to buy a car without going through the hassle of haggling with salesmen in physical dealerships.

The company also has plenty of reasons to support its claims as a trustworthy and reliable used car dealership. These include:

  • Licensed and Publicly-Traded Company: One of the best guarantees of a company’s legitimacy is its legal status. When it comes to Carvana, it is a well-established business that has all its paperwork in check.

For instance, before filing for an IPO, financial institutions perform a thorough check of the company’s assets, paperwork, and business plan.

Since Carvana has been a publicly-traded company since 2017, it massively boosts the company’s legitimacy and authority as a used car dealership brand.

  • Massive Variety of Cars: Carvana is one of the fastest-growing online car dealers in the US. According to the official website, the company offers an average of 55,000 cars online. This allows you to find exactly what you’re looking for.
  • Solid Policies: One of the things we like about Carvana is that it has clear-cut policies for all its operations. This includes detailed information about the company’s warranty, financing, delivery, and return policies.

Since we have access to all this information, it greatly boosts the company’s trustworthiness, despite the limited physical inspection you can do on a vehicle before purchase.

  • Excellent Customer Support: Although Carvana is an online business, it has a knowledgeable and reliable customer service team that you can easily reach. In addition to live chat, you can also reach a Carvana representative through phone calls.

Is Carvana Reliable?

The short answer to this question is yes. Carvana is a reliable used car dealer that sells hundreds of thousands of cars annually. With that being said, Carvana is not for everyone because there are some obvious downsides to buying a used car online.

For example, Carvana has thousands of cars. However, the online dealership only deals in used cars, so you can use it to buy a new one.

Additionally, Carvana puts a fixed price on its vehicles. This makes it an ideal choice for someone who finds that a convenient alternative to haggling with dealership salesmen.

However, this can be problematic for those who prefer to haggle to get a discounted price. Keep in mind that you also can’t test drive the car, which can be a deal-breaker for some buyers.

Is Carvana Safe?

Carvana is a fairly safe company to deal with if you want to buy a used car. The company has strict standards while buying cars to ensure the quality of the cars it offers.

Technically, buyers can still inspect their vehicles before purchasing, but the process is fairly limited when you compare it to traditional dealerships.

This is mainly because you only get to drive the car after you buy it. Yet, the company has a return policy, warranty, and money-back guarantee, which allow for a worry-free purchase.

It’s also worth mentioning that an entity has filed a class-action lawsuit against Carvana for delaying title transfers for vehicles.

Additionally, the company lost its dealer license in some states, including Michigan and North Carolina. You should put both the pros and cons of buying from Carvana in mind before making up your mind.

What Are Users Saying About Carvana?

In this section, we’ll provide you with a brief overview of user impressions about Carvana and its services.

What Trustpilot Reviewers Liked About Carvana

As of June 2023, Carvana has over 8,000 reviews on Trustpilot, with an average rating of 4.2. The 5-star ratings make up around 60% of the reviews.

Let’s check out some of the aspects that most users find satisfying regarding their experience with the company:

  • Hassle-Free Process: Almost all 5-star reviewers praised the convenience of Carvana’s car sale/purchase process. Users with different levels of experience in online sales didn’t have a hard time following the instructions to get the job done.
  • Decent Offers/Prices: Several users also commented on the company’s prices, mentioning that they gave them the best offer, whether buying or selling.
  • Excellent Pickup/Delivery Service: Many people found Carvana’s pickup/delivery service a great bonus. The service is usually on time and includes helpful and reliable representatives.

What ConsumerAffairs Liked About Carvana

Despite Carvana’s decent performance on Trustpilot, the company rating on ConsumerAffairs is notably lower.

As of June 2023, Carvana has over 730 reviews on ConsumerAffairs, with an average rating of 3.2.

The 5-star ratings make up only around 46% of the reviews. Here’s a quick look at what the users like about the company:

  • Fairly Quicker Process: Many users compared Carvana’s services to traditional dealerships, mentioning how much faster and more convenient they are.
  • Delivery As Promised/Described: Carvana described the vehicles perfectly without hiding any aspects.
  • Great Offers: Similar to Trustpilot reviews, sellers often commented that Carvana gave them the best quotes among the competition.

Why Are People Worried About Using Carvana?

Now that you have a better idea about Carvana’s highest ratings, let’s take a closer look at the downsides. In this section, we’ll walk you through the common themes of low-rating reviews.

What Trustpilot Reviewers Are Worried About

1 and 2-star ratings in Trustpilot made up 23% and 5% respectively, which is relatively high. Here are some of the aspects that these users discussed:

  • Quality Issues: Many unsatisfied users commented on the quality of the cars they tested, reporting broken/malfunctioning parts that Carvana didn’t point out.
  • Lengthy Process: Unlike 5-star reviewers, some users mentioned that they didn’t hear back from Carvana despite submitting proper documents.

What ConsumerAffairs Reviewers Are Worried About

With 35% of total reviews, 1-star ratings are the second highest rating on ConsumerAffairs by a thin margin. Here’s a quick look at some of the common themes of these reviews:

  • Poor Customer Support: Several reviewers found the customer support service underwhelming and helpful, especially while resolving problems.
  • Lengthy Buying Process: While many reviewers praised the seamless buying process of Carvana, some individuals missed on cars they targeted because of the lengthy buying process they came across.

Carvana Quality & Guarantees

To compete with traditional car dealerships, Carvana offers a wide range of guarantees and quality assurance policies. Among the most notable quality standards that Carvana offers are:

  • The Certified Program: Carvana has a methodical system that tests out over 150 different aspects of each car they buy. This ensures the functionality of the vehicle for its customers.
  • Carvana Insurance Plan: The company also protects its vehicles through various coverage programs, such as Carvana Care 
  • 7-Day Money-Back Guarantee: After receiving your vehicle, you get to test it out for 7 days. If you find problems with the car, you can return it and get your money back!
  • Complementary Warranty: All Carvana cars come with a free warranty that lasts for 100 days or 4,189 miles.

Carvana Customer Service

Carvana has a dedicated customer service center to help users with their inquiries and solve any problems they might face while using the platform.

To access the customer care center, you should navigate to the Help section on Carvana’s official website. You use the Help section to ask questions, which displays a variety of frequently asked questions with helpful answers to many inquiries.

The customer service section also has plenty of posts, guides, and tutorials that can help users buy and sell cars using the platform.

What Customer Service Options Are Available?

If you need extra help with your inquiry or you’ve encountered a problem that needs an experienced professional to help you, you can find further assistance in the Help section.

You can contact a Carvana representative directly through several main methods, including:

  • AI Bot chat: Available 24/7 and can help you with simple inquiries
  • Live chat: If the AI bot can’t help you, you’ll be redirected to a live agent to help you with the problem.
  • Phone calls: You can also call Carvana’s customer service line at +1 (800) 333-4554. However, the agents are only available from 9 AM to 10 PM Eastern Daylight Time.

Conclusion: Is Carvana Legit?

All in all, Carvana is a fairly legitimate company. Despite going through a rough patch, the company still has a good reputation when it comes to quality and guarantees.

Carvana offers a wide selection of cars that suit various budgets along with several convenient delivery options.

However, Carvana’s services are simply not for everyone. It’s a more suitable pick for someone who processes a smooth purchase/sale process with little face-to-face contact.

Similar Gigs to Research

Besides Carvana, there are other websites and gigs that you can use to save a lot of money. Here are some similar options to check out:

  • Is Carvertise Legit?: Carvatise is a marketing agency that pays drivers and car owners to display ads on their cars using decals.
  • Is Turo Legit?: Turo is one of the largest car-sharing companies that specialize in car rentals. It offers a huge collection of cars to suit different needs and budgets.
  • Is Traveluro Legit?: Traveluro is a relatively new company that specializes in online hotel booking, following the format of Booking and Trivago.

Wrapping Up

With that said, our comprehensive review of Carvana comes to an end. Carvana is a legitimate online car dealership that specializes in used cars only.

The company’s unique business model is quite promising, which allowed it to expand extremely quickly. The platform can be a great solution if you’re all about safety and convenience.

However, if you want to inspect every nook and cranny in the car before buying it, or you want to bargain with the dealership to get a better price, it might not be the ideal option for you.

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