Used-car dealership Carvana adds automobile vending machine in Raleigh

Drivers along Interstate 440 in northeast Raleigh may have noticed a five-story octagonal glass tower gleaming next to the highway, prominently featuring the name Carvana. They may have noticed the shiny cars stacked inside.

What they are seeing may be the automobile purchasing model of the near future – without a sales pitch, without haggling over price, without kicking the tire, without kicking yourself for not kicking the tire.

Carvana, a 4-year old online automobile retailer, is known as the the Amazon.com of car sales, and delivers the rolling stock right to your door. But as sometimes happens with rapid technological advances, there are people who still feel a psychological need to buy stuff at a physical place. Especially something as big and complicated as an automobile.

Hence that glass display case: It’s Carvana’s vending machine. Carvana sells late model used cars in 36 markets nationwide to customers who purchase them online. It installed its sixth national vending machine last week in Raleigh to dispense automobiles like gumballs rolling down a chute called a robotrack.

“We realized giving a pick-up option, just for customer preference, was important,” said Carvana co-founder Ryan Keeton, the company’s chiefing brand officer. “For some folks it’s just more important for them to check it out.”

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Insert your token here.

John Murawski jmurawski@newsobserver.com

There is no poking around the lot here, no inspecting rows of cars, no taking a test drive, no making nervous pleasantries with Sam the salesman. Instead, you are treated to a trademark Carvana ritual: You are handed a coaster-sized metal token, which is deposited in a mechanical slot, which activates the vending machine, which triggers the automated process that lifts your car from its slot and brings it down to terra firma.

In other words, Carvana is proposing to make the car salesman obsolete.

“If you survey a lot of poeple, what’s the worst experience out there?” Keeton said. “A lot of people will say: Buying a car.”

The concept impressed the editors at Forbes magazine, who in 2015 named Carvana the fifth-most promising company in the country. Last year, Entrepreneur magazine dubbed Carvana one of the most entrepreneurial companies in the U.S.

Keeton, a Harvard graduate in English literature who has worked in private equity, finance and marketing, is one of the company’s three co-founders. He offered a tour of the Raleigh vending machine site recently as an assistant operated a handheld wireless device to activate the robotics and retrieve a chartreuse Camaro.

Keeton also demonstrated Carvana’s online purchasing system, pulling up a BMW on screen, spinning it around 360 degrees and zooming in on a detail that caught his eye. Namely: a scratch in the paint.

His point is that the virtual on-screen inspection is just as good, if not better, than assessing a car in a parking lot. The online purchasing system includes a financing option that lets customers adjust payment terms and see monthly payment amounts instantaneously on screen.

Carvana has been selling cars in Raleigh since November 2015, but not every market gets a vending machine. Carvana picked Raleigh because land was available, zoning wasn’t a problem and the tech-savvy demographics were right, Keeton said.

Naturally you, the reader will ask, how is it possible to buy a car without a test drive? Carvana’s solution is the seven-day trial period, following taking possession of the vehicle, during which you can return the car for any reason.

Keeton is keen on data analytics and all the ways that technology can enhance a customer’s “real-time decisioning.” He said the click-enabled decisioning can reduce the time it takes to buy a car down to a mere 11 minutes.

The vending machine is no window dressing but important enough to Carvana’s brand that the company pays customers $200 for travel expenses to get to the site. To qualify the customer must live at least 100 miles away.

And the customer gets to keep the token.

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