GM Pulling into Carvana’s Lane

Visiting a car dealer is not exactly everyone’s idea of a good time. A recent poll found that only 13 percent of respondents thought car dealers treated consumers fairly.

Online-only dealers like Carvana and Vroom have been taking this attitude to the bank, grabbing market share from established dealers and saving Americans countless Sunday afternoons that might otherwise be spent driving aimlessly around dealerships looking for an irrestible deal.

While Carvana and Zoom deal exclusively in used cars, Tesla has gone a step further and sells its EVs only online. Whatever you’re selling, doing so virtually takes a big bite out of expenses, at least theoretically resulting in lower prices for consumers.

This has caught the attention of General Motors, which is launching a new site called CarBravo.com that will try to leave Carvana and friends in the dust. Like them, it will deal only in used cars, at least for now.

“CarBravo will give customers more choice and access to shop significantly expanded inventories of both the dealer and a national central stock of GM used vehicles. Importantly, the program features will also be offered on non-GM used vehicles,” said Steve Carlisle, GM executive vice president and president of GM North America, in a news release.

Dealers a big part of CarBravo

Relationships between auto manufacturers and dealers can get a bit sticky so GM is being careful to portray its latest venture as a win-win-win for dealers, consumers and GM.

“CarBravo is designed to provide customers the convenience to shop how they want, where they want – online, at the dealership or both,” Carlisle said.

There’s no suggestion GM wants to sell new vehicles direct to consumers and even if it did, most states have laws that require cars to be sold through franchised dealers and besides that, the dealers are – at least for now – an integral part of GM’s sales channel.

Equally important, the dealers are going to be the source of CarBravo’s inventory. Carvana, Vroom, et. al. have to buy used cars wherever they can find them. GM expects to have access to nearly all of its dealers’ inventories, potentially giving it a much larger selection of cars and trucks.

If it sounds like dealing only in used cars is a competitive disadvantage, think again. It’s estimated that about 70% of vehicles sold in the U.S. each year at used.

Right now, there are about 400,000 used cars and trucks sitting on GM dealers’ lots. That’s a freewayful more than Carvana, which has about 55,000 listed on its site.

Warranties built in

GM says “peace of mind” will be a big part of CarBravo’s appeal. Customers will get warranty coverage, a network of dealers for service and other supposed benefits.

At-home test drives and delivery will be offered by dealers who elect to do so. Carvana doesn’t provide test drives but it does offer a seven-day free return policy for customers who decide they don’t like the car they bought.

GM says the platform will be up and running this spring.