Carmax will be fine. They’re consistently profitable and well-capitalized. There are a lot of people out there who default to buying from Carmax because they think used cars are the best deal and they like Carmax’s no-haggle pricing and 30-day return period.
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Vinfast?
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Just got this beaut last night
Makes sense now!
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5 posts were split to a new topic: Macroeconomic musings
Back to Vroom, please.
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We are still a ways a way from reaching sustainable market parity when it comes to used cars.
Who else here remembers buying a ~10 year old running and driving (note, I didn’t say shiny or pretty) car that wasn’t FUBAR for $1-2K or less?
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Topic temporarily closed to allow for thread cleanup. Please heed the no politics rule.
Makes sense, gives them the whole year to liquidate and figure out their final tax liabilities amongst other things.
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VinFast can use their locations. 
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so how exactly do companies like vroom, shift and northwest liquidate all their assets? just ship em off to auctions? Genuinely curious
Since the secondary market players want to avoid completely torpedoing the market, they will avoid flooding the market with a bunch of cars at auction.
The banks that previously backed Shift/Vroom’s collateral will likely seek to provide low-interest flooring debt for other used car sellers. The goal is to cover the transfer of Vroom’s inventory over to other lots without those units suddenly getting a new fair market value re-set at auction. Naturally, money is going to be spent/lost in all this, but it’ll be less of a market-disaster than if the units simply all went to auction.
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Not banks, just bank. Ally was Vroom’s only line of credit provider. At one point Vroom had $700mill line of credit from Ally.
According to SEC filing, they are…“planning to sell its current used vehicle inventory through wholesale channels.”
More info on cost of liquidation in 4 days.
“At this time, the Company is unable in good faith to make a determination of an estimate of the costs associated with the Value Maximization Plan, partly due to the uncertainty of the liquidation process of its used vehicle inventory, the Company’s ongoing obligations under its contractual and lease agreements, and ongoing assessment of severance and retention costs. The Company intends to amend this Current Report on Form 8-K within four business days of when it is able to estimate these costs.”
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Wow Ally screwed up being the sole lender to Vroom’s experiment haha.
I wonder if wholesale channels means individual auctions, or if they’re just going to package up chunks of the inventory and see if they can move a big chunk to another party.
@djrabbi is chomping at the bit to acquire every eTron GT Vroom had in inventory.
And yet they jumped 12% last week…clearly this is peanuts to them
Not really, Ally lends post sale.
Whomever holds the floor plan for these cars is the one taking it in the rear.
Oh I thought that was Ally as well. Double whammy if Ally did all the Vroom leasing and will get whacked on residuals.
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@holeydonut You are right, floorplan is Ally as well
https://ir.vroom.com/news-releases/news-release-details/online-automotive-retailer-vroom-announces-amendment-floorplan
Ally is going to repo the cars…lol
Maybe Ally needs to buy an automaker so they make the cars, inventory the cars, sell the cars, finance the cars, repo the cars, and service the 96 month loans on the cars.
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