CARY, N.C. -

Just a handful or so years ago, online used-car sales platforms like Carvana, Shift and Vroom were startups, thought of as “disruptors” to the market.

These days, they have national advertising campaigns, even popping up during the Super Bowl. And after an IPO (from Vroom) and a SPAC merger (from Shift) in 2020, all three are publicly traded.

So, with that in mind, Auto Remarketing shares this recap of how each performed in 2020.

We begin with Shift, which was the most recent in announcing fourth-quarter and full-year 2020 results.

Shift’s year ends with record quarter for sales & revenue

Shift pulled in $195.72 million in revenue in 2020, up 18% year-over-year. And after a loss of $1.76 million in 2019, Shift’s gross profits came in at $12.18 million last year.

Adjusted gross profits for the year climbed 91% to $12.82 million.  

The company reported a net loss of $59.15 million for the year, improving upon a net loss of $80.48 million in 2019.

Its adjusted EBITDA loss was $68.46 million, compared to $51.29 million a year earlier.

Shift increased its total units sold by 18% year-over-year, moving 13,135 vehicles. Of those, 9,497 were ecommerce sales (up 15%) and 3,638 were wholesale sales (up 29%).

The company closed the year with a record quarter for total units sold (4,666) and revenue ($73.4 million).

“In several respects, the fourth quarter was a record-setting period for the company. We set new records for both units sold and revenue, representing 147% and 168% year-over-year growth, respectively,” Shift co-chief executive officer Toby Russell said in an earnings release. “We prioritized maintaining top-line momentum through the challenging Q4 environment, which ultimately meant Q4 gross profit and Q4 adjusted GPU were below the expected range.

“We made both strategic and tactical decisions to improve our reconditioning processes, initiate a branding campaign and enter new geographic markets. These actions have laid the foundation for success in FY 2021.”

Added co-CEO George Arison, “A critical operational focus of Q4 was to improve reconditioning, with our in-house throughput increasing dramatically. This has created strong momentum for 2021.

“For the first quarter 2021, we expect revenue to grow 26% sequentially from Q4 2020 and adjusted GPU to increase 2-times over Q4 2020. For the full-year 2021, we expect revenue to grow 130% over 2020 and adjusted GPU to grow 19% year-over-year. With this strong momentum, we are trending on track for our targeted mid-term adjusted GPU of $2,500.”

Arison added later in the release: “Q4 was about maintaining top-line momentum through the end of the year, to put ourselves in a position to accelerate growth through Q1 and beyond. I am proud of the way our team responded to significant adversity in 2020 and am excited to demonstrate continued progress throughout the year.”

Vroom's ecommerce sales up 82%

Next up, Vroom pulled in $1.36 billion in total revenues last year, up from $1.19 billion in 2019.

Retail vehicle net revenue was $1.07 billion, up from $952.91 million a year earlier. Wholesale vehicle net revenue was $245.58 million, up from $213.46 million. Product net revenue climbed from $23.71 million to $38.20 million. It had other revenues of $1.37 million, compared to $1.74 million a year earlier. 

Vroom had a net loss of $202.80 million in 2020, compared to a net loss of $142.98 million a year earlier.

Vroom had 34,488 ecommerce sales last year, beating the year-ago figure by 82%. Wholesale unit sales were up 4.5% at 21,108.

TDA sales fell 43.3% to 7,385 units.

All told, total unit sales were up 20.7% for the year, coming in at 62,981.

In an earnings release, Vroom CEO Paul Hennessy said: “Vroom had a strong fourth quarter, with significant year-over-year growth in our ecommerce business. Inventory and marketing are scaling as planned, which is increasing the velocity of the Vroom flywheel, driving conversion and increased sales and revenues.

“Consistent with our relentless focus on data science, we announced the acquisition of CarStory, a leader in AI-powered analytics and digital services for automotive retail, which closed in January 2021,” he said.

“As the used vehicle market continues to embrace the ecommerce model, we will continue to execute our plan and invest in scaling our business and improving our customer experience as we transform the market for buying and selling used vehicles.” 

How Carvana fared in 2020

As reported earlier in Auto Remarketing, Carvana said that it finished 2020 with a 37% increase in retail units sold, a 42% rise in revenue and a 57% jump in total gross profit fueled by a $400 uptick gross profit per unit.

With all of those tremendous gains, Carvana said that its annual net loss came in at $462 million, an increase from the $365 million loss recorded in 2019.

Carvana founder and chief executive officer Ernie Garcia certainly appears to be confident of the company’s long-term potential, saying in a news release, “2020 highlighted the strengths of our business model and validated our vision for the future of car buying.

“We’re extremely proud of how our team navigated an unprecedented year of constant adaptation,” Garcia continued. “Their exceptional execution and relentless focus on delivering the best experiences to our customers vaulted us to becoming the second-largest seller of used cars in the country, another meaningful milestone in our march to becoming the largest and most profitable automotive retailer.”

Here are more specific details about Carvana’s 2020 performance:

• Retail units sold totaled 244,111, an increase of 37%

• Revenue totaled $5.587 billion, an increase of 42%

• Total gross profit was $794 million, an increase of 57%

• Total gross profit per unit was $3,252, an increase of $400

Another segment of Carvana’s business that made major improvements in 2020 was purchasing vehicles from consumers, acquiring 204,000 units last year. That figure is up 95% year-over-year, as Carvana purchased 104,000 units from consumers in 2019.

In a letter to shareholders, Carvana discussed its expectations and objectives for 2021.

“We expect to accelerate growth in retail units sold, and with demand for our offering currently outpacing our supply chain capacity, we expect the level of growth and timing of sales to be governed primarily by the speed at which we scale our production,” the company said.

“We expect revenue growth in FY 2021 to be in line with retail units sold growth,” Carvana continued. “We expect total GPU, which includes retail, wholesale, and other gross profit, in the mid-$3,000s in FY 2021, continuing our progress on increasing GPU. Finally, in light of the size of our opportunity and our strong financial position, we expect to invest in building our business for the long-term, leading to a small EBITDA margin loss in FY 2021 while continuing our progress on demonstrating leverage.

“We are excited about 2021 which we expect to be another significant step toward our long-term goals,” the company reiterated.

 

Nick Zulovich contributed to this report.