It isn’t hyperbolic to say that Carvana Co. has modernized the used-car buying experience for the digital age.

The online marketplace allows users to buy and sell used vehicles almost instantaneously.

The company has invested so much in its delivery operations that 40% of its customers in Phoenix are now getting their vehicles delivered on the same day or the next day.

“That’s worth pausing on, taking time to think through the implications. [The fact that] thousands of vehicles can be purchased in minutes and delivered in hours is a highly desirable and extremely difficult to replicate capability,” Carvana CEO Ernie Garcia said during the company’s third-quarter earnings call last week.

One thing Carvana has in abundance is customer data. It knows what its users want to buy, how long they spend shopping, and other behavioral patterns to accompany the financial data it also collects.

“Our system is, for lack of a better description, sort of listening all the time to what our customers are interacting with and what it is that they want,” Garcia said.

So if there is any company that knows the state of the average used-car shopper in 2025, it is Carvana. And the good news is that the company sees blue skies ahead.

Carvana “vending machines” deliver same-day or next-day vehicles.

Hyoung Chang/Getty Images

Carvana results point to a strong used-car market

Carvana Q3 results

  • 150,941 retail units sold, +44%
  • Revenue +55% to $5.65 billion
  • Net income $263 million, +$115 million year over year
  • Record levels of retail units sold, revenue, adjusted EBITDA, and operating income

Carvana set several records in the third quarter, and the company says it doesn’t see any signs of macroeconomic weakness in the near term.

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Garcia said multiple times that while the company is “always paying attention,” “things feel relatively stable,” and the company says it doesn’t “see signs of macro weakness today.”

But even as it perceives strength in the industry today, Caravan sees itself as well-positioned “if the industry does take a downturn,” because it expects “at some point there will be cycles.”

However, Carvana’s retail-side view of today’s used car market differs slightly from what the average U.S. customer is experiencing.

Carvana shares were up 7.7% to $330 at last check on Nov. 3.

Average new-car prices cross $50,000 threshold for the first time ever

For used-car buyers, visiting Carvana can be a very seamless experience, but the market is causing a lot of stress for many car buyers.

The used-car market is directly affected by new car market pricing, according to CarRight. Higher prices on new cars prompt more car buyers to consider used cars, which in turn increases prices in that market.

The average new car sold for more than $50,000 in September for the first time ever, according to Kelley Blue Book.

Related: New car buyers, beware: The latest data are concerning

While the firm called the jump in prices a “blip, not a sign of things to come,” it also said that “if longer-term patterns hold, we’ll cross the $50K barrier for good sometime next year.”

Car manufacturers have been warning in recent months that they can no longer absorb the tariff costs like they did when the duties were first levied. And once they start passing the cost on to customers, used-car buyers will inevitably feel the pain as well.

But it’s not all bad news.

What used-car buyers should expect in the coming months

While used-car prices are rising, they are increasing at a slower rate than new-car prices.

The average used car sold for $25,825 in September, according to KBB, just a 2% year-over-year increase.

KBB says the best predictor of used-car prices is the wholesale prices dealers pay for used cars at auction, and those prices have held relatively steady in recent weeks, “suggesting that used car shoppers might see a little predictability in the fall.”

And there is one bit of “great news” for shoppers: Inventories are slowly creeping back to pre-pandemic levels.

During the pandemic, automakers produced approximately 8 million fewer vehicles than they would have under normal circumstances in 2021 and 2022. Fewer cars mean a shorter supply, which means higher prices.

Dealers ended September with 10% more vehicles than they had a year ago.

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