Vroom is done

[Cobra Jet]

Vroom collapses and suspends operations; article courtesy of CarBuzz:
https://www.thedrive.com/news/online-use-car-seller-vroom-collapses-as-sales-fall-losses-mount

I think many seen this coming - and it could trickle down to other similar business operations…

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[Skye]

I read up on the company this morning.

- IPO in 2020. Any company buying/selling on-line and delivering to home at the time was hyped

- They lost money every year they were in business

- Softening used car market

- Higher interest rates, for both the business and customers

Edit: https://www.allianzgi.com/en/insights/outlook-and-commentary/zombie-companies

Article provides some general stats on the amount of zombies and which industries.

https://www.cnbc.com/2023/10/31/zombie-firm-bankruptcies-amid-fed-interest-rate-hikes.html

Some recent bankruptcy stats for companies that are publicaly traded.

 

[shogun32]

there's some suggesting it was a VC money-grab from the getgo. That they fully expected it to collapse but hey, that's how VC think so little of their millions. And if you can get the public to bail you out because they are retarded, even better!

Now we see the air come out of the already deflating used-car price balloon. It's gonna be fun to watch.

 

[Balr14]

Carvana is scaling back as well. It's too bad. It was a great way to sell a car and made CarMax raise their offers.

 

[Inthehighdesert]

Something doesn’t add up. A profit of 3100ish a car is actually pretty decent.

 

[IPOGT]

Something doesn’t add up. A profit of 3100ish a car is actually pretty decent.

Without knowing the expenses any amount is pointless though.

 

[Inthehighdesert]

Completely agree. But, if I state my profit is x, that’s after all costs and expenses. Probably should of beenstated as the margin was x on each car, not profit.


QUOTE="IPOGT, post: 3911884, member: 21587"]
Without knowing the expenses any amount is pointless though.
[/QUOTE]

 

[Skye]

https://www.cnbc.com/2024/02/06/cre...ating-financial-stress-new-york-fed-says.html

https://www.newyorkfed.org/medialibrary/interactives/householdcredit/data/pdf/HHDC_2023Q4

I was taken aback by some of the information in the CNBC article. Digging a bit deeper, I pulled the latest report from the Fed.

We often talk about auto loans or a cooling market. We see that in these reports. People 18-40, they're starting to default significantly on auto loans (Page 29). More concerning, all age groups (Page 30) are starting to default on credit card debt.

The CNBC article lists multiple statistics. The Fed slides you can cruise through.

Edit: Probably going a bit deeper than people care for, but...

https://data.bts.gov/stories/s/Transportation-Economic-Trends-Transportation-Cost/5h3f-jnbe

Link above explains the bits of the Transportation bucket, and how they form part of the US CPI. It highlights how you can have huge differences in buckets, with the overall CPI number not appearing as bad.

https://data.bts.gov/stories/s/Transportation-and-Inflation/f9jm-cqwe/

Scrolling down in the second link, you'll notice a current chart that references auto insurance, among other things. Something we have a dedicated thread for, the Insurance portion of the Transportation bucket is not leveling off. It's been trending consistently ever-higher over the last four years.

 

[Balr14]

Wow, that's interesting. Since we both retired (two years ago), we have reduced the number of cars we have (4 down to 2) and changed insurance to reflect our changes in life style (much fewer miles driven). So, we were not aware of the changes going on.

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