“Price is the price” means the number you see is supposed to be the number you pay. The goal is to avoid the back-and-forth and surprise costs you might get at a dealership.
The transcript says “Stalantis,” which sounds like it means Stellantis, a big car company that owns multiple brands. They’re described as reacting to Carvana’s growth with a new rule for dealerships.
The Dodge Ram is a large pickup truck. It’s designed to carry cargo and tow trailers, but it can also be used like a normal truck for daily driving. It’s mentioned because it’s one of the truck brands in the Stellantis group.
The Chrysler Town & Country is a minivan. It’s made to carry people comfortably, usually for families or groups. The podcast mentions it while talking about changes related to dealers and how vehicles are sold.
This describes a dealership-cap rule limiting how many new dealerships a dealer group can acquire per year. The segment frames it as a response to rapid dealership buying by Carvana-like competitors.
The Jeep Wrangler is a rugged SUV that’s built for off-road driving. Here it’s the example of a new Jeep he bought without spending a full day at a dealership.
A “digitally focused playbook” means using online tools and processes—like browsing, pricing, and paperwork—rather than relying on in-person dealership steps. In this segment, it’s contrasted with the traditional dealer model that’s protected by regulation.
Concept
politically powerful dealers run the show
This is about how car dealerships and government rules can strongly affect how cars can be sold. The speaker is saying those rules can protect the traditional dealership model.
“Controlled chaos” here means the dealership tries to make the buying process take a long time on purpose. The goal is to pressure you with time so you’re more likely to give in and say yes.
Traditionally, dealerships acted like places that keep cars on-site for people to look at. The host is saying the dealership is basically being used as a storage-and-selling location, not just a showroom.
Selling cars online means buying a car through websites or apps instead of only going to a dealership. The point here is that it can make the process easier and faster for customers.
Dealer reviews and ratings are customer scores for how a dealership treats people. Here, they’re being used to judge whether the dealership’s pricing and fees are clear up front.
A doc fee is a dealership charge for handling the paperwork for your car purchase. In this segment, they’re saying a lower doc fee can make the deal feel more straightforward.
Dealer add-ons are extra items a dealership may try to add to your bill. The hosts are saying this example dealership doesn’t tack on extra add-ons beyond the advertised price.
The advertised price online is what you see on the dealership’s listing before you go in. They’re saying a transparent dealership keeps that price close to what you’ll actually be quoted.
Negotiation means you try to bargain for a better price instead of taking the first number you’re given. Here, they’re pointing out that a deal can be negotiated down.
Company
Chrysler Dodge Chief Ram
This phrase is being used to describe a set of brands/dealership categories. The host’s point is that Carvana was ranked #1 by how many cars it sold in that category.
The FTC is a U.S. agency that protects consumers. When they issue warnings, it usually means they’re watching for unfair or misleading business practices—like how prices are presented.
“Theft of pricing” here means tricking customers with misleading prices or hidden fees. The idea is that the final cost isn’t what the buyer thinks it is based on the advertised number.
Term
scrutiny ramps up
“Scrutiny ramps up” means more attention and checking from regulators. Here, that increased oversight is presented as a reason dealers may face more pressure about how they price cars.
A franchise dealer is an approved car dealership that sells a specific brand’s cars. Automakers set rules for how these dealers operate, and changing who gets in can shift competition.
Chrysler, Dodge, Jeep, and Ram are different car brands under the same corporate umbrella. The hosts are talking about how dealers for these brands are being affected.
The Buick Century is a car model that was made for comfortable everyday driving. It’s the kind of vehicle that would appeal to people who want a smooth ride for regular trips. The podcast mentions it in the context of dealer and sales changes.
LIVE
It's noon here in Ventura City, New Jersey, on our nation's capital, Washington, DC,
and this is Car Edge Live for Tuesday, May 19th with your hosts, me, Ray, hanging out where I
always hang out, light in my damn living room, ladies and gentlemen, and Zach hanging out somewhere
different today. I have no idea where, but I am okay with that. How are you today, handsome?
Doing so well. I'm still in Washington, DC, so don't get too carried away, folks.
Today's show, Carvana warns the car market. An incredible article from Christopher Odds
in the Wall Street Journal. We're going to be breaking it down here in just a moment before
we do a friendly reminder, folks. Today's show is brought to you by CarEdge.com. Me, my dad,
and our incredible team for the past six years have been doing all we can to make the car buying
process better for you. Please check out our website, CarEdge.com, to learn more. In particular,
if you want to learn about our car buying services, click on Car Buying Service and get yourself a free
consultation call with our team, humans on our team. We've got some incredible people,
and meet the concierges, meet the experts that work on your behalf to support your car buying
journey. You can learn more back at CarEdge.com. Dad, the big story we're going to start with today.
Wait, wait, wait. The big story is I saw a comment yesterday,
and you promised to call me father today. Not dad or pops. So, son.
What's up, father?
You're a father.
All right, father. Here's where we're going to start things today. The Wall Street Journal,
Carvana grew into a used car titan. Its new car sales project has dealers rattle. The
company's online know-haggle sales model is quietly extending to new vehicles. What's
fascinating here, dad, is that Carvana is pretty rapidly, honestly, moving into the new car business.
They are no longer just a used car dealership, and this is alarming dealers nationwide because
they're growing fast, and customers, I think, are buying more vehicles from Carvana dealerships
than non-Carvana dealerships. They've got some of the fastest growing dealerships in the United
States. You can see this slide here that shows you. They've got seven locations. They've opened
seven locations, spent $160 million in just the past 14 months. So, dad, what is going on over
at Carvana, and why is the car market on notice?
It's really kind of simple. Carvana has spent a decade or more since their inception of peddling
the idea that the price is the price, that you can do the whole thing digitally, that we're
going to make it easy for you, that there's no BS associated with it. It's pretty much cut and dry.
That disruption in the marketplace for used cars took hold, and people have bought on
and bought into that message. Well, conversely, they're trying to do the same thing on the new
car side. What it shows, at least in their six or seven stores that they have, is that there is
a market out there of people when it comes to buying a car that don't want to go through all the
crap. They don't want to go through all the BS. So, dealers should take notice. Those who put their
customers through all the BS, those who make their customers jump through hoops, those who think
that they're doing the customer a favor by having the transaction only take, I don't know, four,
5678 hours. Hey, would you like a slice of pizza we're having pizza today?
You don't have to go anywhere. Have a couple slices of pizza, folks. Yeah, dealerships are
getting the warning signal that it's time to change. If I'm not mistaken, Dad, because Carvana
has gobbled up these seven new car dealerships in such a short period of time, it's scared dealers
so much that Stalantis, the company that owns Chrysler Dodge, Jeep Ram, all those brands came out
with an announcement that said, you know what, we're going to enforce a rule now. You can only
buy one new dealership per year. In the past year, they bought seven. There's a lot of concern here.
And I think your point is right. And I'm going to ask a question. Put it in the chat. When I say
Carvana, what word or words come to mind for you for that brand? Now, yeah, I know we'll get a lot
of crap in there, but like, what word comes to mind for you? And we're going to come back to that in
a second. I'm just going to read the beginning of this Wall Street Journal article again.
Joshua Higginbotham, a 43-year-old dad in the Kansas City area, swore off buying a new car
from Jeep Ram parent Stalantis after a few bad experiences at the automakers franchise dealerships,
including losing a $500 deposit for a Dodge Challenger he didn't end up buying.
Higginbotham says, I don't want to spend a whole day in a dealership and they always like to make
it take an entire day. But Higginbotham recently changed his mind buying a brand new $51,000 Jeep
Wrangler in a bluish-gray color called Anvil. This time, he didn't have to leave his living room couch.
He bought this new Jeep from a car dealership more than a thousand miles away that is owned by
used car giant Carvana. The Tempe-based Arizona-based company is testing whether it's a digitally
focused playbook and work in a more tightly regulated world of selling new cars where
politically powerful dealers run the show and state laws protect their business model.
And in debt, that is like, you go to their website. This is the Casa Grande Carvana website.
It's Carvana, y'all. And if you're a new car dealer, it's a wake-up call.
Well, it should be. And...
That is.
You know, in 1977...
Here we go.
I needed to get a job. I was getting married. I saw an ad that said,
come sell cars. We'll give you a demo. And I applied for the job and I got the job.
And the whole concept of the job was to make buying a car
controlled chaos. And what I mean by that is, you as the salesperson needed to be in control,
the process had to be somewhat chaotic so that it would take hours upon
to complete the transaction. The thinking being that time spent by the customer that
dealership equals commitment and be the more time you force them to stay there,
the weaker they become. You wear them down and eventually they just say, please, God,
I'll take the car, leave me alone. Just please. Let... Yes, yes. I'll give you all the money you want.
Just let me go back home to my family because people felt like they were being held hostage.
And that's the way the car business has operated for years and years. Go ahead and ask me anything.
I'm not asking. I'm telling. Carvana acquired the Casa Grande Arizona dealership about a year ago
from another dealer group. It has since turned the small store on the outskirts of Phoenix
into the top-selling CDJR dealer in the United States as of April, according to Solantis figures,
shared with dealers and as seen by the Wall Street Journal. The store is selling about 350
vehicles a month, compared with 30 to 50 a month before Carvana took over. You can go on ad nauseum
about what the car business has been. We're going to talk about the future. The future looks different,
Dad. What more data do you need? This is coming from the Wall Street Journal, from Chris Attsmouth.
He's saying they are the number one selling CDJR store in the United States. And you know
what's fascinating about this? That gets me really fired up, Dad. The next paragraph here,
yet in person, the dealership probably looks like a sales juggernaut. Reaching the store
requires a 50-mile trek from Phoenix through barren land dotted by cactuses and the occasional
sign warning of blowing dust. It is tucked in the corner of an automall between two competing
dealerships. The ways of the past that we have to have the biggest dealership, and it has to be
this mausoleum that it's changing. The dealership, in a lot of ways, Dad, is just like an inventory
holding space. And you sell cars online, or obviously we're doing the sell cars at the AI.
Yes. And I don't want to suggest that Casa Grande, Arizona, the home of Lucid Automotive
Manufacturer, is a podunk little town in the middle of nowhere in Arizona between
Phoenix and Tucson. But it is. Okay. And it is home to the number one performing
CDJR dealership, which last time I checked, CDJR was struggling mightily nationwide. If you're
Stalantis right now, you are over the moon that Carvana is buying your dealerships because they're
finding ways to sell your cars. Why? Because they make it easy. Incredible moment for the car market
and a huge wake-up call. A huge wake-up call for everyone who says they're in the auto business,
the car business. Okay. So with this wake-up call, how do you get dealer principles that are entrenched
in the old ways of doing business to suddenly become advocates for the new ways of doing business?
Can you do that? Or will they be like dinosaurs and just fade away? And 200 years from now,
archaeologists will dig up automobile dealerships and wonder, well, gee, how did that happen?
Was there an ice age? Did a meteor hit somewhere nearby?
Momentary car edge, infomercial moment. I mean, this is why I think what we're doing with the
dealer reviews and dealer ratings is so important because in theory, dad, buying a car here from
Acura of Boston, a dealership that is rated 100 out of 100, they earn an A in terms of transparency.
The number seven most transparent dealership in the state of Massachusetts, why? Because their
doc fee is right under the Massachusetts average. They have no dealer add-ons. Their advertised
price online is pretty much the same as the price you're going to get quoted at the dealership.
In many ways, that's kind of Carvana adjacent. I mean, you can see here, they'll even negotiate.
This deal they negotiated $1,594 off. That's fantastic. So in some ways,
that being an A-rated dealer right about now gives you some level of credentialing similar.
I'm not saying it's exactly like being Carvana, but I mean, there has to become a way for the
auto industry to move forward because my question for you, Deb, is do you see a connection between
this article that, again, is talking about how car dealers are rabble by Carvana getting into
the new car business? Do you see a connection between that energy right now? That happened.
Seven dealerships, $160 million spent by Carvana. The number one sales by volume dealership in
the United States for Chrysler Dodge Chief Ram was Carvana. Do you see a connection between that
and this? All dealerships urged, come on, automotive news. All dealerships urged to take
FTC warnings about the theft of pricing seriously as scrutiny ramps up. Do you think there's a
connection here between Carvana pushing on dealers and the FTC pushing on dealers? Is there a
correlation? I don't know that there's necessarily a correlation. Do you think it's serendipitous?
I think more than likely it is. Carvana came up with this concept that they were going to make
it easy when they decided to go into business. Was their thinking based on, well, in the future,
the FTC is really going to hold dealerships feet to the fire, or do we want to become disruptors
and find a better way for people to be able to buy cars? And I believe in my heart that
their thinking was, we want to be disruptors and find a better way for people to buy cars.
Now, that just happens to mesh really, really well today with what the FTC is looking for
from dealerships. And truth be told, it shouldn't take the FTC saying we need you to stop being
deceptive for dealerships to finally say, hey, we need to stop being deceptive.
I'm really surprised you don't see a correlation between the two. And I'm not asking with regards
to Carvana's business model or business plans. It's 2026. Eventually, the car business is going
to have to be more transparent, more fair, more efficient. The Gallup annual trustworthiness of
every single year has had car salesperson at the very bottom for decades. This has to happen
eventually. And so I don't think it's serendipitous that government regulators are putting pressure
on dealers at the same time that competitive pressure is putting pressure on dealers. Amazon's
also in the new car business now too. Not suggesting Amazon's program is anything special.
And quite frankly, we should talk about this too, that Carvana makes more money than any
other car dealer in the whole world for every vehicle they sell as consumers. It's something
to be aware of too. There's a lot here, but I don't think it's serendipitously,
eventually it was going to happen. I think it's much like us. We see an opportunity to improve
how cars are bought and sold. And that opportunity just happens to mesh with what the FTC is trying
to do after 120-some years worth of dealerships screwing people. And I know, I see the comments,
great, you screwed people for 43 years now trying to find redemption. But no, I didn't screw people
for 43 years. I thought the system was broken way back when and tried to change it where I could.
Okay, now there's, I don't know, a few more people involved in trying to change it so that it can be
better, so that the American consumer can be treated honestly. And we should honor them for
coming in and wanting to relieve us of our inventory, as opposed to seeing them as a mark.
Okay? So, yeah, you can see the connection. I just see it happens to mesh because enough people
have said, I'm mad as hell and I'm not going to take it anymore.
Yeah. And who cares whether it's intentional or a byproduct of something kismet? Who cares?
S-A-T word right there. It's happening. And I think that's the most important thing for everyone
in our community to understand is like an awakening is happening in the auto industry right now.
Look at this step. For now, Stalantis, the parent of Chrysler Dodge Jeep Ram, is the only automaker
to have allowed Carvan to become one of its franchise dealers. The move isn't sitting well
with the traditional dealers who sell those brands. Quote, Stalantis dealers are an uproar
over this, said South Florida Jeep Ram dealer, Gian Marco Taverna. He doesn't object to Carvan's
entrance in the business so long as Stalantis sticks to policies preventing a single dealer
from growing too large, he said. It's up to us to compete and figure it out, Taverna said.
That is the operative piece here. You have to figure out, this is capitalism 101. You have to
figure out how to compete. And it's a tremendous opportunity for these dealers to compete better.
S-It's an opportunity to evolve. Okay. You either evolve or you disappear.
K-And dad, if I may, you know me. I love doing live experiments. That dealer-
S-I do know that about you. And it's father.
K-Father.
S-Dad.
K-Father. You know I love doing live experiments. That dealer was a South Florida Chrysler Dodge
Jeep Ram dealer, right?
S-Yes.
K-Okay. Let's go to dealer reviews for a second and let's go to the map.
S-Yes.
K-And you know what we're going to do?
S-We're going to South Florida.
K-We're going to go to South Florida. Okay, so we're going to go down here and slow down.
And now we're going to toggle Jeep dealers. Okay, so let's see. What are we working with?
We've got an A dealer down here. Let's zoom in on Miami. We've got one A, one B, two Cs and a D.
S-Yeah. That kind of sounds like my normal report card when I was in high school.
K-Let's go over to Fort Myers.
S-Chef for the A.
K-We have a D.
S-Yes.
K-Punkta Verde. We've got a B. Okachibi. I'm really showing that.
S-Okachobi. Okachobi for goodness sake.
K-Sorry, father.
S-Yes.
K-You know, here we go. Central Florida. We've got some A's. A C. What's going on here?
More A's. That's fantastic. What's going on Orlando? A B, a D.
This is demonstrative of what's going on in the car business right now. If you're down in Fort
Lauderdale, Miami Beach, this area, your options are the one A dealer. There's all the way down here.
What's that? Pometo Bay?
K-Yes.
S-Daidland Dodge Chrysler Jeep Ram. They've got an A grade. You've got Brickle Chrysler Jeep Dodge
Ram who has a B grade. Or you're going to C and D dealers who are not transparent.
K-You know, what's this dealer doing? Let's take a peek. They've got add-ons on every quote we've
received here at CarEdge totaling $1,482. Ok, so you're now competing against CarVano. What are
you going to do? S-Stop inter-add-on.
K-Yeah, you better evolve and adjust your business practices. I mean, that's the whole concept. So
either either you evolve or you disappear. You're going to go out of business because
with the advent of this map, with the advent of what it is that, you know, I'm not even going to
say what we're doing at CarEdge.
S-But in general, what's that?
K-With the information they need to be able to pick and choose where they want to do business.
Now, it seems to me that a quasi-intelligent person would look at that map and say,
I think I want to go to the A deal or not the D deal. I'm just thinking, okay, I'm spitballing
here. I could be wrong. You know, that quasi-intelligent one might go, I think I'd really rather deal
with the D deal or because I like to spend 8, 9, 10 hours there. I think between the FTC,
between CarVano getting into the new car business, between what it is that you are doing with our
business that change is afoot. I mean, dealers won't be able to ignore it because those who don't
evolve, their customers will ignore them and travel to wherever it is they need to travel
to be treated like a human being that is valued because you know what? A dealership can't survive
without somebody spending their money there. As customers, we still have all the leverage.
They got the product. We have the ability to buy it and if we don't buy it, guess what? They still
have the product and it sits and it costs the money. They're either going to change or they're
going to go away. One more quote from the article. Again, great article. CarVano, which declined to
comment to the Wall Street Journal, has repeatedly refused to elaborate on its plans surrounding
new cars. Quote, it is still too early, so stay tuned. Ernie Garcia, the third the CEO, told analysts
during the company's quarterly call on April 29th, like his counterparts and Phoenix dealer,
Matt Bowers, was scratching his head earlier this year when he noticed CarVano's Dallas store
rocketing up the Solanthus sales charts. It was number eight in the country as of April,
according to Solanthus figures. Bowers, a multi-state dealer based in New Orleans,
owns a Solanthus dealership only 15 minutes from CarVano's Dallas store. He took a drive
over to his competitor's store to check it out. Finding it not very busy in person. CarVano's
site shows that it is willing to ship a number of new vehicles from the Dallas store to buyers
well outside the area without charge. Bowers said CarVano's sales are likely coming at the
expense of smaller rural dealers that sell only a few hundred vehicles a year. Whether CarVano
can take a bite out of larger operations like his is ultimately up to buyers, he said. Quote,
if it is a better thing for the consumer than I either adjust to that or I've got to do something
else, go sell popcorn, Bowers said, and I'm okay with that. I just wanted to end there on the CarVano
store. That's perfect encapsulation of what we're talking about here. Yeah, and hopefully he sells
some of the best popcorn in the history of popcorn. No, I hope he changes his business model because
I don't want CarVano to own every single new car dealership in the United States. That also
doesn't sound like a good outcome for him. I would think, and this is just me,
I would think that the sixth largest publicly traded companies,
Lithia, AutoNation, Penske, Group One, who am I missing? I'm Sonic,
Asbury. I think this is, they're looking at this as, okay, we're going to have some major
competition now, and we're going to have to look at the way that we do business,
and they are going to have to come up with a simpler way for their customers to buy cars from
them. I just think that this is going to force small, large dealers to reconsider their business
model. Absolutely. It's just that simple. If I may, one of my dreams when we started this six
years ago was that there could be a major change in how cars are bought and sold in this country,
that we could bring dealers into the 21st century and get them to see that there's a way to still
make a profit that you need to make, and yet make it an entirely frictionless purchase for
consumers out there. That's not to say all consumers, because some refuse to do the work
to understand what it is that they can or cannot afford, and so that they need a certain type of
handholding, and usually when they need that handholding, they end up getting taken advantage of,
but that's a different story for a different day. I never thought realistically that at almost seven,
well, at that time I was 69. I never thought at 69, I would see those changes implemented
in my lifetime. It seemed to me that they've had 120 years to build the systems that they've built
and the tools that they use and the way they approach things, and that there wasn't going
to be significant change for me to see. I think between disruptors like Carvana, the FTC making
it pretty plainly known that they want to see dealer behavior changes, and disruptors like CarEdge
and my son who figured out a way to get viable, verifiable information so that you could create
a dealer transparency index, are reasons for me to have hope that now, just six days away from my
75th birthday, that I might actually live long enough to see the changes. I think it's coming,
Dad. Yeah, and I honestly, I'm going to say this, and you might think I'm not, but I honestly think
it's going to happen sooner rather than later. It feels as if there is a perfect storm brewing,
and there is a tsunami wave of change that is about to happen in the industry.
And I'd like to believe that we are at the forefront of it, and we will be one of the major
causes for it. So welcome to the CarEdge tsunami, ladies and gentlemen.
Thanks for being a part of the CarEdge. And you know what? We've given Carvana a heck of a hard
time over the years because, wow, growing pains in that business, but great work to that team.
They've definitely changed the industry, and that's for sure. Still, they make $6,000 on every
use car they sell, and a normal car dealer makes $1,500. So please, your mileage may vary if you're
going to buy a car from them to do your research, and you can't sit here and take anything away
from what they've done. They've changed the car business, and they're changing it in a way right
now that feels, it feels structural. It feels like it's going to really, really shift how we all
buy cars over time. That being said, Dad, want to do a quick acknowledgement. If you all haven't
seen it, I was super proud. This is over this channel, Aso2 More Than Cars. I'll put the link in
the chat as well. Dad, that's me up there on that big old stage. I watched that whole damn video,
that 44-minute video with like 6,000 commercials in it. And look at that.
You'll skip every one of them, by the way. Look at my slide behind me. All people want to buy from
honest car dealers. This was me doing a keynote at the Auto Industry AI Summit, where I was
live mystery shopping 100 car dealers with our AI as I was on stage and then walking through a
presentation. But yeah, please, if you're in our community, I just ask, search this on YouTube,
leave a comment, like the video. I want to bring more awareness to this because I think it's our
effort to try and communicate to the world how we're going to try and shape this to look more
fair and transparent and efficient. So yeah, I'm really excited, Dad, and timely that the
Wall Street Journal published that article and it's really interesting to see here the reaction
that the industry will have. And whether it's serendipitous or not, the FTC pressure is also
real. I'm going to be at that June 16th summit here in DC talking about the FTC and fare pricing.
Seems like I might need some new t-shirts and not wear the same hat every day. I think there's
about to be a level of maturity in car edge land to try and influence some of this.
Where the CEO's going to have to dress slightly differently?
I might even have to shave. Oh my.
All right, folks. Well, we'll call it a show for today. Again, if we can help you out with
anything, caredge.com. My dad and our incredible team would love to help you. Thanks for listening
and being a part of today's show. If you enjoy the channel, please be sure to subscribe to it.
And Dad, enjoy the afternoon. It's quite father. Enjoy the afternoon. It's quite warm outside.
I have a track workout tonight. I am so nervous. I'll also be live tomorrow from Detroit, Michigan,
man. Yes. You're going to Detroit? I'm going to Detroit. So please be prepared
to stay live from Ventner City, New Jersey, and Detroit, Michigan. Wow. It'll be my pleasure.
Can't wait, man. Can't wait. All right, folks. We're back tomorrow, Dad. I love you.
I love you too, handsome. And it's father, damn it.
About this episode
CarEdge Live breaks down how Carvana is moving from “a used car titan” into new-car sales, extending its online know-haggle model and pushing a digital-first experience. Hosts connect the disruption to dealer pressure, including Stellantis limiting dealership acquisitions and FTC scrutiny of deceptive pricing. They also share a concrete example: Carvana’s Casa Grande store reportedly jumped to top-selling CDJR status with sales rising from 30–50 to about 350 vehicles per month. The episode frames transparency and reduced friction as the competitive battleground.
Today on CarEdge Live, Ray and Zach discuss the latest info on Carvana. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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