Carvana, an online used-car dealer described as the “Amazon of cars,” has expanded into Newark, the company announced Wednesday.
The Newark expansion will mark the company’s first entry into the New Jersey market. Carvana chose to expand to Newark due to customer trends and interest in the area.
“A lot of customers from that area were visiting our website,” said Ryan Keeton, chief brand officer for Carvana. “It’s a car-centric city, it’s a large city and our customer is the average car buyer.”
Carvana offers access to used cars through its website. Customers can view 360-degree photographs of each car, along with itemized relevant details about the car, such as accessory features or minor scrapes/imperfections present. If a customer chooses to buy a car, it’s delivered to them within a few days.
Keeton said the company’s success was partly due to flaws in the typical dealership model.
“It’s one of those things, once you go through it more than once, it’s not necessarily the best experience,” said Keeton.
For example, dealerships typically offer a “test drive” that’s restricted to a short distance near the dealership. Carvana offers a seven-day return policy, allowing customers to incorporate the new car into their daily routine before committing to it.
The company houses its inventory in large distribution centers around the country and delivers cars when an order is received. Carvana’s Philadelphia distribution center will service Newark and New Jersey.
Carvana was previously available in New Jersey, but the expansion into Newark means that deliveries are done by an employee of the company instead of a third-party.
The publicly-traded company did not say if it would be expanding to other cities in New Jersey, but Keeton noted that the company is “growing very fast.”
Carvana was founded in 2012 and reported $225.4 million in revenue for Q3 2017, a gross profit of $20.4 million for the quarter. The company has roughly 9,500 cars in its inventory and employs over 1,500 people across the country.