'The Firm That Bought My Car For More Than I Paid New Has Lost 98% of Its Value'

Carvana, the used car dealer that trusts robotic algorithms to buy your car practically sight unseen, was the third-fastest company to ever make it onto the Fortune 500 -- only Amazon and Google did it faster. But for the third day in a row, its stock is trading for just around $7 a share, plummeting 98 percent from its all-time high of over $360 last August. From a report: My first thought on reading the news: maybe the company shouldn't let robots pay people more than their cars cost brand-new? This February, I sold a seven-year-old car to Carvana for more than I paid out the door and wrote a story about the perfect storm of factors that led to that outcome. (Stimulus checks! Chip shortages! Covid fears! Unheard-of demand for vehicles! Blind trust in algorithms!) But after reading through the past six quarters of the company's financial results and shareholder letters, it seems much simpler than algorithms running amok. Carvana's humans bet badly by buying too many cars. Throughout 2021, as Carvana saw its first and only quarterly profit, the company kept telling investors how it planned to scale up production (read: get more used cars ready to sell) to meet the pandemic's unprecedented demand.

Read more of this story at Slashdot.