Carvana’s bet on Slate is ACTUALLY a bet on itself, as the future of automotive retail
As new electric vehicle brands like Scout and Slate search for alternatives to franchise auto dealers, America’s largest online auto retailer is quietly positioning itself to become the future of automotive retail.
Earlier this week, online auto retailing giant Carvana was given a green light to buy shares in Jeff Bezos-backed Slate – and the timing is notable.
While dealer groups across the country continue to challenge direct-sales models used by companies like Tesla and Scout in court, manufacturers are still looking for a way to market, finance, deliver, and service their vehicles at scale in a way that cuts the dealers (and their stupid pricing games) out of the picture.
Carvana already does all of those things. And whether or not this was part of the plan, the fact remains that as the company continues to buy up more and more dealers, it is effectively eliminating their ability to object to those deals. Advertisement - scroll for more content
Hear me out
The big vending machine; by Carvana.
If Carvana becomes the 800 lb. gorilla franchisee in a given market, it could overcome the franchise dealers’ legal objections to selling Slate trucks direct by simply deciding not to raise them in the first place, because they are the franchise owner.
If they snap up enough dealer groups in enough markets, Carvana could establish a precedent with Slate that it could, in theory, shop to Scout. Or Lynk & Co. Or BYD.
You get the idea.
From here to there
Slate truck at ACT Expo; photo by the author.
That sort of speculation is obviously looking years ahead into one of the murkiest of crystal balls imaginable (in fact, I think this is a bowling ball). That said, it’s not the craziest idea I’ve had – and this one seems to be playing out.
TechCrunch is reporting paperwork filed with the Delaware division of corporations shows that Carvana was issued a warrant to buy shares in Slate back in 2025, at around the same time Slate Auto was starting to put together its $650 million Series C funding round.
While it’s not clear if the warrant was exercised (Slate has been relatively tight-lipped about its investors since emerging from stealth last year), we do know that Amazon founder Jeff Bezos and Guggenheim Partners CEO Mark Walter are big backers, and Walter’s firm, TWG Global, is a major backer of Carvana.
We’ll have to wait and see how this all plays out, but a billion here and a billion there could see Carvana become the de-facto service and delivery center for any new EV startup hoping to launch itself in the US – and that might not be too far from the plan, as it is.
What do you guys think? Head on down to the comments and let us know.
Original content from Electrek; source links throughout the article.
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