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GM's used-car platform CaroBravo to provide inventory scale, options
"That's very good coverage if you compare us to Carvana, CarMax or the like," Carlisle told Automotive News. Cox Automotive estimates that half of all used retail sales — or about 10.6 million vehicles — were sold by franchised dealers last year. GM aims to list up to 80,000 vehicles […]
"That's very good coverage if you compare us to Carvana, CarMax or the like," Carlisle told Automotive News.
Cox Automotive estimates that half of all used retail sales — or about 10.6 million vehicles — were sold by franchised dealers last year. GM aims to list up to 80,000 vehicles on CarBravo this year, spokesman Sabin Blake said.
During CarMax's fiscal year that ended in February, the largest used-vehicle retailer sold 924,338 vehicles on a retail basis. Carvana sold 425,237 vehicles in 2021, and Vroom sold 74,698 last year.
"If you think about some of the competition, one of their big challenges could be sourcing good used cars," Carlisle said in an April 29 interview. "In today's world, a good chunk of that is leaking out of our system between us and our dealers."
GM's business is much broader than used-vehicle sales. The automaker will likely absorb a piece of the market without much harm to existing retailers, said David Whiston, equity strategist for U.S. autos at Morningstar.
"There's a room for a lot of players," Whiston said. "If you're willing to make the IT investment, it can be successful for sure."
Customers will shop through GM's digital retail platform, which allows them to complete much of the purchase online but also connects them with a dealership.
"If you're shopping through an OEM for used cars, it's a bit of a fragmented experience. You're going dealer by dealer," Carlisle said. "What we're able to do is bring that all together into one experience from a consumer perspective and do it in a way that benefits not just consumers but also dealers, because they have access to more inventory and better tools than they would have if they're doing it on their own."
Over time, GM plans to sell software and subscriptions to used-vehicle buyers, as it aims double revenue to $280 billion by 2030 from its five-year average of $140 billion. It expects software and other new businesses to grow nearly 50 percent annually through the end of the decade.
CarBravo "gives us another connect point from a consumer point of view," Carlisle said.
The automaker can market OnStar and OnStar Insurance, for instance, to GM and non-GM used-vehicle buyers through CarBravo. Eventually, when vehicles in the used fleet have the technology to enable GM's Super Cruise driver-assist system, GM will be able to offer that feature to customers, along with the over-the-air updates that come with it.
"It's incrementally positive because this is asset-light revenue, in the sense of that the vehicles are already built," Whiston said.
"That's likely a much higher-margin revenue source than just selling the vehicle."
New- and used-vehicle retailers are facing inventory pressure because of the global microchip shortage and other supply constraints. That, at least in the short term, could affect CarBravo's success, said Daniel Imbro, a retail analyst at Stephens.
"It's going to depend on how many dealers opt into it," he said. "Critical mass will be needed because liquidity is the most important thing that will drive long-term volume."
Carlisle acknowledged the challenge of launching CarBravo amid a used-vehicle shortage but said GM will consider inventory levels as it builds out the regional distribution centers "so that there is value added for the dealer and then for the consumer."
As a manufacturer of new vehicles, GM is well positioned to collect most eligible used inventory that becomes available, he said.
"We've got priority access to the cream of the crop," Carlisle said. "It all adds up to a really compelling opportunity."
C.J. Moore contributed to this report.
Art Scene offers guests full night of springtime fun | Entertainment
Mon May 9 , 2022
The Franklin Art Scene had a packed lineup during the monthly event Friday in downtown Franklin. Shop owners hosted artists of various mediums to showcase their works as patrons shopped, sipped on refreshments and enjoyed live music. While rain was in the forecast and the temperatures were on the chilly […]
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