Carvana Co
A surge in used-car prices took care of Carvana's bottom line early in the pandemic.
While lower prices imply less revenue on each vehicle sold, making a big purchase more affordable for consumers beset by inflation and high-interest rates, Bloomberg reports.
Prices in the U.S. are already declining, falling last month the most since the early days of the pandemic.
"We would love for car prices to drop," Garcia III told Bloomberg TV on Thursday. "It would be great for us and great for our customers."
Carvana on Wednesday shared plans to reduce debt, extend maturities, and sell stock, sending its shares soaring.
It could use a boost to reduce costs and restructure its debt-heavy balance sheet after a car market slump pushed the company into trouble in 2022.
In 2021, automakers slashed production amid the semiconductor crisis, the used-car dealers made up for the shortfall by buying cars at auction and from consumers and turning them around for sale at rapidly rising prices.
This week, Carvana reported a second-quarter FY23 sales decline of 23.6% year-on-year to $2.97 billion, beating the consensus estimate of $2.59 billion. EPS loss of $(0.55) exceeded the consensus loss of $(1.15).
Price Action: CVNA shares are trading higher by 4.62% at $48.89 on the last check Friday.
