A customer pitted Carvana and CarMax against each other when vetting offers for the sale of her car. And she learned there is a clear winner.
TikToker Ashley (@classashley) posted a pair of TikTok videos about her experience. In the initial video, Ashley says “The difference in prices is THOUSANDS.”
She thought that it was suspicious the two, which have a very similar business model, offered her such wildly different values for her vehicle. “First off, sus that they’re such different prices. Will share my experience for both after a check has been cleared,” she wrote in the caption for the clip.
In this video, she didn’t name which company offered her more money.
@classashley First off, sus that they’re such different prices. Will share my experience for both after a check has been cleared 😂 #carmaxx #carvana #sellingmycar #charlotte #customerexperience ♬ original sound – goldenbiscuit.tx
However, in her follow-up video, she divulges more details.
“OK, so about two weeks ago, we were T-boned with our family car, so I had to buy a new car, and then I had to sell my other car,” she explains. “But the problem was that I was in Pennsylvania with my family, so we had to get a new car We used Carvana.”
She says her car-buying experience with Carvana was “good.” However, she says the company failed to let her know about a chip in the windshield of the vehicle.
“I’m not pleased about [it], but we’re gonna let that go,” she says.
She says all that was left to do was sell her old car. But, she says she wanted to do her own research first to assess the value of it. She says she found out, through Kelley Blue Book, that he car was valued between $21,428 to $23,457.
So which one gave her the highest offer?
She then went to Carvana and CarMax to get offers from both.
“So, my tried and true. I’ve bought and sold through Carvana, had great experiences for that little windshield drama that I had, and they offered me $22,200, so that’s pretty much in the range, right?” she says.
Then she went to CarMax.
“CarMax offered me $24,000, which is higher than Kelley Blue Book. So I was like, ‘Great. What’s the catch?’” she recalls thinking. “Are they gonna make me go into the office and then like mark it down all these different pieces.”
Toward the end of her clip, Ashley says she personally had a good experience buying though Carvana and selling through CarMax. “But always do your due diligence, because that was a $4,000 swing, which is insane,” she says.
@classashley Replying to @Heather The results! As always do your research but this is my experience @Carvana @CarMax #sellingcar #customerexperience #carvana #carmax #greenscreen ♬ original sound – Ashley | Reviews and Recs
Viewers are Team CarMax
While Ashley likes both brands, there is a clear winner in the comments section of her post. Most people seem to be Team CarMax, the company that offered her $4,000 more to buy her car.
“I sold my last car to carmax, it was by far the highest offer and so easy!” one exclaimed.
“Love Carmax! Haven’t sold to them but I love my car I got from them! So quick too we were in and out,” another wrote.
How does CarMax make a profit?
Because the higher end of the Kelley Blue Book value of the car was only $23,457, this begs the question: How is CarMax going to make a profit off this car?
In 2022, it was reported that CarMax profited $2,147 off of every vehicle sold, making it the “most profitable used car retailer in the country,” according to car outlet Jalopnik. So CarMax is taking no losses. But how is this possible? According to Jalopnik, “the primary reason for this is simple—most people are overpaying.” And some people who don’t want to deal with the hassle of dealerships are happy to do so.
“What makes CarMax such a draw for used car buyers is excellent marketing that espouses a low-stress, hassle-free car buying experience. It also helps that it has tons of locations in major metro areas and customers have the ability to transfer most vehicles from one location to the next for a fee. This gives buyers access to a nationwide network of inventory. Of course, the crux of the CarMax strategy is the ‘no-haggle’ pricing. The price you see is what you pay,” the car outlet further reports.
CarMax offers better deals
MarketWatch—after a very thorough comparison—also found that while Carvana is more convenient as it is fully online, CarMax will give you the best price regardless of if you are buying or selling.
CarMax is also the more senior of the two companies as it was founded in 1993 and has its business model down to a T. Carvana was founded in 2012 and has embraced the “scrappy startup” moniker.
The Daily Dot has reached out to CarMax and Carvana via email and Ashley via TikTok comment for further information.
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