Carvana New Car Sales: CNBC Coverage & DCG Insights

CNBC recently covered Carvana new car sales and their quiet but significant move into franchised dealerships. Carvana has purchased seven franchised dealerships that sell Stellantis brands, including Chrysler, Dodge, Jeep, and Ram. One location in Casa Grande, Arizona, has already become Stellantis’ top-selling store in the entire country, moving more than 700 new vehicles last month alone. For context, that same store was selling roughly 30-50 vehicles per month before Carvana acquired it.

Most people know Carvana for its car vending machines and its online used-car model. What’s less visible is the infrastructure behind it: a nationwide logistics and vehicle processing network that industry consultant Larry Dominique compared to Amazon’s back-end operations. Carvana already has the capacity to recondition approximately 1.5 million vehicles per year, far exceeding its current sales volume of under 600,000 last year. That kind of headroom matters.

The traditional dealership model makes money across four areas: new cars, used cars, parts & service, and financing. Up until now, Carvana had only been playing in two of those buckets: used cars and financing.

Brian Gordon, President of dealer advisor and broker Dave Cantin Group, explained what likely drove the move:

“After stabilizing their core business, I think they realized, by looking at the franchise model, that there was a significant amount of revenue and gross profit opportunity that their business model didn’t even contemplate.”

They saw the opportunity sitting in new car sales, parts & service, and decided to go after it.

The franchised dealership system isn’t going away. New car sales are heavily regulated state by state, and dealers must follow strict rules from automakers on everything from showroom layouts to service requirements. These aren’t small hurdles.