Comparing Carvana to its Main Competitors: Business Model, Size, and Features

11 Major Carvana Competitors in 2023

Carvana, who is a relatively new player in the race to be king of the digital car sales business, has become remarkably popular within the market. But as with anything that becomes popular, specific competitors will sense this and feel compelled to try and compete with them. While there are different types of marketplaces, Carvana actually competes as a retailer. It’s a disruptive platform that helps people buy cars in just a few steps. However, Carvana has quite a few competitors.

How does Carvana compare to other marketplaces? We have conducted deep research on Carvana and analyzed its main competition. This article will compare Carvana with similar businesses in terms of business model, size, features, and much more.

An OverView of Carvana

Carvana is a peer-to-peer dealership that sells cars online. The company operates in all 50 states and plans to launch internationally in 2020. It has raised $1 billion in funding and is currently valued at more than $5 billion.

Carvana was founded by Ernie Garcia III and Nick Vardamis in 2012. The company initially operated as an online marketplace for used cars but quickly realized that customers often wanted the option to drive away with their new vehicle the same day they bought it. Carvana built a network of vending machines to accommodate this demand where customers could pick up their newly purchased cars. Today, these vending machines are located across the country and have become a major selling point for the company.

Carvana’s main competitors include Shift (which also operates as an online marketplace), Vroom, TrueCar, and CarMax — although none of these companies operates as many physical locations as Carvana does.

In its first-quarter earnings release in May 2019, Carvana reported revenues of $72 million and a loss of $0.3 million compared to revenues of $59 million and a loss of $9 million during the same period last year. The 9-year-old company was listed on the 2021 Fortune global 500, placing it as one of the list’s newest companies. Carvana made over $5.5 billion in profits for the entire year of 2020. Carvana employs 3879 people.

Who Are Carvana’s Main Competitors?

Carvana is a Phoenix-based company that buys used cars and sells them online. The company has been around since 2012, but it’s only in the past few years that it has expanded its reach nationwide.

In addition to Carvana, other companies offer similar services, including Vroom, AutoNation, and Beepi.

Source: Authen Tech

ACV Auction

ACV Auctions is the largest vendor site for auctioning wholesale vehicles. This online marketplace portal streamlines the distribution cycle, from asset maintenance to purchase, mediation, and logistic support. ACV Auctions made $208.36 million in sales in fiscal 2020. Approximately 1150 people work for the company.

ACV Auctions features a comprehensive car platform with unparalleled accessibility. The business performs a complete vehicle condition examination and notifies interested clients. ACV Auctions is the greatest Carvana option for wholesaling used automobiles, with over 110,000 cars sold per quarter.


CarMax is the largest retailer of used cars in the United States. As of January 2016, CarMax has 205 used car superstores and franchise locations in 35 states and Washington D.C., Canada, and Puerto Rico. The company began as a used car lot in Richmond, Virginia, in 1993.

In 2008, CarMax was ranked as the #1 auto retailer by Forbes magazine’s “America’s Best Employers” list for small companies. The following year, it was named one of Fortune magazine’s “100 Best Companies to Work For”. In 2012, CarMax received additional recognition when named one of FORTUNE magazine’s “100 Best Companies to Work For”.

Like Carvana, The company’s “no-haggle” pricing model allows customers to purchase a vehicle at a fixed price without negotiating with a salesperson. CarMax also offers customers an overnight test drive policy and an optional seven-day return policy on all vehicles purchased at any CarMax store nationwide.


Vroom is an online marketplace for used cars. It was founded in 2012 by the same team that founded Carvana, the online marketplace where you can buy a car without ever setting foot in a dealership. Vroom was only launched in 2015 and has a smaller inventory.

Vroom currently sells more than 50,000 cars at any given time. They’re all listed on their website, which also includes detailed photos and information about each model’s history and condition and any repairs that have been completed.

Unlike Carvana, Vroom doesn’t own any dealerships or car lots; they’re simply an online marketplace where buyers can find new and used vehicles from private sellers who list their cars on the site — making it possible for buyers to get lower prices than they would at traditional dealerships.


Shift is a direct-to-consumer car purchasing service that allows you to buy and sell cars online with no middleman. With Shift, you can search for cars by make, model and price or request quotes from dealerships in your area. The company also offers a marketplace for used cars where dealers and private sellers can list vehicles for sale.

The company recently raised $90 million in funding from investors, including General Motors Ventures and Valor Equity Partners, bringing its total funding to $182 million.

The Shift has a couple of advantages over Carvana. It has more capital, so it can afford to spend more on marketing and discounts for consumers who want to try its service. And it offers the ability to return your vehicle at any time, which could be attractive to people who are worried about buying a car sight unseen. But the biggest advantage might be that Shift is already operating in Pittsburgh and other cities around the country — so you can use it right now.


Beepi, a startup that was once considered the “next-generation” version of Carvana, is shutting down. Today, the company posted a notice on its website saying it will stop selling cars and close its doors by March 3, 2019. The company has raised $90 million from investors, including Spark Capital, Foundation Capital, SherpaVentures, and Redpoint Ventures.

Beepi was founded in 2013 by Ale Resnik and Odell Reneau, who had previously worked together at TrueCar. Beepi’s business model was similar to Carvana’s. It allowed people to buy cars online without going through a dealership, but the company did things differently.

Instead of using shipping containers as showrooms as Carvana did, Beepi used brick-and-mortar showrooms with cars on display. It also offered financing options through financing partners like Bank of America and Wells Fargo instead of working with an in-house lender like Carvana does today.

AutoNation Direct

AutoNation Logo (PRNewsfoto/AutoNation, Inc.)

AutoNation Direct is a wholly-owned subsidiary of AutoNation Inc., which operates more than 300 dealerships in 15 states and an online used car marketplace called AutoNation Direct.

AutoNation Direct offers up to 40 cars at a time, most of them from its own inventory. You can search by make, model, or price point from anywhere in the country and get quotes on insurance, financing, and trade-in value for your existing car.

The company says it typically has about 2,000 used cars for sale on its website at any given time. It also offers customers the option to pick up their vehicle at one of its stores or have it delivered to them via a shipping carrier like FedEx or UPS.

Just like Carvana, AutoNation Direct doesn’t charge any dealer fees (which can add thousands of dollars to the cost of buying a new car). But unlike Carvana, AutoNation’s website doesn’t provide quotes on trade-ins; you’ll need to contact the dealership directly if you want one.

KAR Auction Services

KAR Auction Services is an auction company that specializes in selling cars, trucks, and vans. KAR Auction Services was founded in 2012 and had been expanding ever since. In 2017, the company had revenues of $1 billion and over 6,000 employees.

The company uses a patented auction process that it claims gets higher prices for customers than traditional dealerships or private sales. In 2018 alone, KAR bought more than 500,000 vehicles through auction houses and sold about 350,000 units online, with an average profit margin of about 20%.

In addition to its car auctions, KAR Auction Services also offers other services such as car-buying programs for dealerships and banks, vehicle remarketing services (i.e., reselling used cars), vehicle repair services (i.e., fixing cars that have been in accidents), and even used car financing options (i.e., lending money to customers who want to buy used vehicles).

DriveTime Automotive Group, Inc.

Like Carvana, DriveTime offers a direct-to-consumer model that has enabled it to operate with lower overhead costs than traditional dealerships.

DriveTime was founded in 1990 by Michael Maroone, who operated the business until 2016, when he sold it to CDK Global for $405 million. DriveTime Automotive’s website also states that it operates “more than 250 locations across the U.S.” and provides financing to customers with credit scores as low as 500.

The company has long been known for its “no money down” sales model and “drive now, pay later” financing program that allows customers to make payments on their cars over time.

In recent years, DriveTime has expanded into used car sales with its subsidiary DriveTime Auto Credit Co., which provides financing options for customers who want to buy used cars at DriveTime’s locations or through its website.

Auto1 Group

Auto1 Group is a German group of companies that offers an alternative to Carvana. Auto1 Group was founded in 2016 by three former Rocket Internet executives who were dissatisfied with their previous employer. They started Auto1 with a mission to make the car buying experience less stressful and more transparent.

The company has raised over $170 million in funding from investors, including Softbank, General Motors, and Tengelmann Ventures. According to Crunchbase, Auto1 Group has raised over $200 million in total venture funding so far.

Auto1 Group’s core business provides wholesale vehicles to dealerships around Europe and North America. Customers can purchase cars directly from Auto1 Group online or through its website, but these are not new cars; they are used vehicles from auctions or wholesalers in Germany or other countries.


CarGurus is a website that gathers car dealerships, auto brokers, and private sellers to help consumers find the best deal. The company was founded in 2006 by Langley Steinert, who later became its CEO. CarGurus has raised $363 million in funding from investors like General Catalyst and SoftBank.

The two companies are fighting for market share and have been locked in a battle for years. CarGurus has more than 25 million listings, but it’s not as large as Carvana in terms of inventory. The company has 3,000 cars listed on its website at any given time, while Carvana has over 5,000.

Carvana is valued at more than $6 billion following its IPO, but its growth has slowed as CarGurus, and other rivals have gained ground. CarGurus, founded by Langley Steinert, is valued at just under $5 billion. Since going public, it has seen impressive revenue growth and now makes more than $1 billion in annual revenue.

eBay Motors

eBay Motors is a car buying and selling website owned by eBay. It was founded in November 1998 as part of eBay’s Auto listed items service, which has been running since 1995. Under the name of eBay Auto Auction, the service originally allowed individuals to list their cars for sale and sell them directly to other individuals.

In March 2000, the company changed its name from eBay Motors to eBay Autos and introduced auctions for used vehicles. In 2001, eBay announced plans to move into the new business of financing and insuring automobiles, but this initiative was discontinued in 2003 because of difficulties securing insurance providers.

On June 28, 2006, eBay announced that it would purchase PayPal for $1.25 billion in stock. Two months later, on August 3, eBay shareholders approved the merger with PayPal for $1.5 billion in cash. The annual income of eBay climbed from $8.6 billion in 2019 to $10 billion in 2020.


Who is Carvana’s primary rival?

Carvana primary competitors are vehicle retailers such as AutoNation, Inc. (AN), CarMax Inc. (KMX), and Lithia Motors Inc. (LAD). These companies operate in a similar business model to Carvana by providing an online platform where buyers can purchase new and used cars without visiting the dealer’s lot. 

Is CarMax the same as Carvana?

CarMax is also one of the competitors, but not exactly the same. Instead of selling directly to consumers online, CarMax has its own dealership network where customers can buy their cars in person.

The two companies have overlapping business models: they sell used cars online at competitive prices. But they target different types of buyers: CarMax focuses on entry-level vehicles. At the same time, Carvana specializes in luxury cars that are often too expensive for its typical buyer to purchase outright.

Can you negotiate with Carvana?

They do not negotiate prices; their automobiles cost as affordable as possible, and no dealership fees are added.

What’s the distinction between Carvana and Vroom?

The main difference between Carvana and vroom is that Carvana is a used car dealer, while vroom is a car rental service.

  • With Carvana, you pay for your car online and pick it up at a local lot.
  • With Vroom, you can buy a car online and deliver it to your door.
  • Carvana operates its own lots where customers can pick up their cars, while Vroom allows customers to choose their own delivery location.
  • Carvana is only available in select cities, while Vroom serves all 50 states.

Where does Carvana obtain vehicles?

Carvana buys vehicles from auctions, customers who trade in their used cars, and other sources. The company’s auction purchases are for the vast majority of its stock. Carvana also buys vehicles directly from customers who trade in their cars when they purchase on the site. And it may buy vehicles directly from dealerships or private sellers as well.

Final Thoughts

Carvana is looking to become a top e-commerce operation in the auto business once it becomes profitable. The company has to watch out for giants like Amazon, which might decide to get into the game one day. 

In the meantime, Carvana should continue as they are doing now and offer as decent service as possible to their customers. They have just launched the website’s car configurator, so it looks like they promise good things in the future.

We believe in working smart, not hard, and that's been our life motto. We're self-taught learners who are passionate about sharing knowledge. We've created this website as a platform to empower individuals and businesses with marketing insights. Our team at Unlimited Marketing is driven by a desire to educate and provide accessible marketing wisdom. We believe in the transformative power of effective marketing, whether for personal growth or business success. Our mission is to simplify and make marketing knowledge easily accessible to all.