Vending machines aren’t only for soda and chips anymore.
Atlanta-based Carvana, the second largest used car dealer in Georgia, has opened the first-ever car vending machine in Nashville, Tennessee. The car vending machine has five floors and can hold up to 20 cars. Carvana chose Nashville because the region has historically been a good market for used car sales, said Carvana CEO Ernie Garcia to The Street.
Carvana, which buys used cars and makes a profit by marking them up and delivering the vehicles to customers, handles most of their sales over the Internet. The company, which is only two and a half years old, also allows a potential buyer to test a used car for seven days.
After buying a car online, a Nashville Carvana customer can head over to a steel and glass tower of used cars, receive a special coin from the welcome center, and pop it in a terminal. The chosen car is then brought down by mechanical arms to the delivery bay, where the customer can give it a look over before driving off.
Carvana CEO Garcia thinks car vending machines will save money for his company and make the car buying experience more pleasant.
“We wanted to create something that would be inexpensive long-term so we could keep our prices historically low and then do something on brand metaphorically where customers are in complete control of the experience and making car buying fun,” Garcia told The Street. “Often the experience of buying a car ruins the experience of buying a car, and we don’t want to do that, so we came up with this idea of a vending machine.”
By building car vending machines, Garcia hopes to cut down on his company’s delivery costs – but you should only expect to see these car dispensers in metropolitan areas, for now.
“Offering these vending machines is actually less expensive for us than delivering cars to customers as long as we’re getting a certain volume of customers, so it’s easier to invest in these vending machines in larger markets where we’ll have more sells,” Garcia told The Street. “I would say you’re more likely to see these popping up in our larger markets than in our smaller markets, but it is our model going forward.”
Car dealerships are expensive and can be a hassle for both customers and car sellers. According to a Gallup poll on how trustworthy Americans view certain professions, car salespeople are notoriously distrusted. In fact, car salespeople are seen as only one percentage point more trustworthy than the lowest ranked career – congresspeople. Lawyers, bankers and police officers were all seen as more ethical, according to the poll.
But Carvana hopes Americans can avoid the salespeople found at dealerships once and for all. Garcia said Carvana’s uncharacteristic car vending machines will alleviate the stress of a dealerships, car salespeople and car delivery.
“There are still customers who have been bruised and wounded by their historical car purchasing experiences, so they’re not super comfortable with an automotive retailer coming to their door so they would rather go somewhere to get the car,” Garcia told The Street. “They feel like it’s easier to walk away probably, so I think we didn’t really anticipate that because we knew we wouldn’t be giving customers that experience, but that is real.”
Carvana has no plans to open another car vending machine yet, Garcia told The Street. However, if the Nashville location goes well, we can expect to see more of these car vending machines cropping up across the US.
[Header Image via Business Wire]