Carvana is on Wall Street as the supply of used cars increases and new car prices stay at record highs.
Shares for the online used car dealer have more than doubled year-to-date and are up by more than a third in the last five days.
He continued that we saw less used car supply in the market over the last few weeks, while new car prices remain at all-time highs due to pent-up demand. Used cars are an incredibly hot market because consumers are looking to cut spending in the wake of inflation, given the record price of new cars. Company issues remain, as used car sales are down, 2023 inventory up, and used car sales down.
The Kelley Blue Book showed the average used car in America sold for $27,564 in October 2022, the lowest price since April. The price of a new car was $48,281.
The nationwide supply of used cars is still 26% higher than one year ago.
Kobeissi said Carvana's recent surge is relative, as the stock is still down 94% over the last year due to the tumbling used vehicle prices and re-emerging supply. Many of the company's problems go beyond the near-term trends, and it is not certain if current car market conditions will persist. He said something. Consumer spending is falling, higher rates are coming, and the car market is unlikely to remain hot once supply chains begin normalizing, and the company continues to trade near bankruptcy territory.