Carvana continues to disrupt local markets for dealers with their ever-expanding march of the Carvana Vehicle Vending Machine. As they move forward with their business model, seeking to erect the high towers their brand is known for, they are bumping up against local state or municipal rules and guidelines along the way.
Although the local brick and mortar establishment could almost be called a dealership, they are still touting the fact that you buy the cars online. Some of those rulings, which dictate how a dealership is to be established and run within certain land-use regulations are not, in the mind of Carvana’s legal team at least, applicable. Their argument is based on the fact that they consider the 6.5 story towers to be, in actuality, fully automated, coin-operated “car vending machines”, and not a dealership.
While Carvana is currently not discussing it’s proposed move and project for the 1.3 acre buildout in the Richmond area, it will resemble the tower already completed in Nashville, as well as three others under construction in Texas – Dallas, Houston and Austin.
It remains to be seen just how well these vending machines are received and accessed by the communities they are being built in. But if their web site is any indicator of acceptance by the market at large, dealers would be well served to keep a sharp eye on their business model and start making plans on how to keep their market share with automotive online retailing processes of their own.
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