Whew! Carvana narrowly avoids its dealer license being suspended in Florida, but that should not have been an issue in the first place.
The Florida Department of Highway Safety and Motor Vehicles (FDHSMV) threatened to suspend the dealer license of this vending machine-style used car operation if it didn’t correct some egregious errors. We don’t know the cause of the trouble, the company growing too fast, untrained employees, or poor business practices, but we do know that this company was on the verge of being shut down in Florida.
The Key Date Has Passed
The key date for compliance was January 31. This was the date set by the FDHSMV when a second review of outstanding titles would take place. Over the course of only 30 days, Carvana was able to reduce the number of outstanding 2021 titles from 400 to 29. While the goal was to have all of them filed and completed, these final 29 have had action taken on them. Eleven of these customers received a buyout of the vehicle purchased, which included compensation for all payments made plus 15 percent, and the other 18 did not respond to inquiries or failed to provide necessary documents as requested.
The Entire Hassle Could have Been Avoided
The Florida department threatened to pull the dealer license in December if they did not submit title applications for all vehicles sold prior to December 1, 2021. For most of us who have purchased vehicles from dealers in the past, we expect the dealership to handle the title work and submit the application immediately after the purchase of the vehicle. It’s mysterious why this used car dealer was faced with such a threat. Submitting the title application should be a simple step in the normal process of selling cars.
The Change is Taking Place
While most of us simply assume a dealership understands how to process a vehicle, Carvana is making changes to its customer service and delivery practices. They will not deliver a vehicle to a customer until the title is in possession of the person or financing company where it should be. This might delay some of these vehicles being delivered, but it should only cause a delay of a few days if any at all. This simple change can help this company avoid embarrassing issues, like being threatened by a state agency, from every happening in the future.
Investigations Are Ongoing
Even though this company narrowly escaped its dealer license being pulled, the agency will continue to investigate customer complaints made against this company. Director of Motorist Services, Robert Kynoch, stated that this company would continue to be reviewed regularly to ensure they are complying with the regulations set by the state. A Carvana spokesperson responded with a commitment to provide excellent service to customers and comply with regulations to ensure Florida residents could continue to purchase vehicles from this company. The question that remains is whether or not this company can fulfill its commitment and avoid a potential shutdown in the future?
Hot Water in North Carolina
The reason we ask the question of Carvana’s commitment to compliance has to do with their suspension from North Carolina last year. Similar circumstances to what took place in Florida were found in North Carolina, specifically in the Raleigh area. Several vehicles were sold without titles and without state inspections. Additionally, at least one instance of a vehicle sold in North Carolina was solid with out-of-state plates. These were all violations of state laws and caused the company to be banned from selling cars in this state until 2022.
Here We Go Again
Not only did Carvana violate state laws in North Carolina and now in Florida, but they also failed to meet their own guarantees of a complete inspection process. This failure was found to be the case in the Raleigh area, which was another factor that led to this company being banned until this year. The suspension in North Carolina was for 180 days, which has passed.
Will Carvana Get its Act Together
The thought of the dealer license being pulled in Florida, coupled with the adverse practices and ban in North Carolina, makes us wonder if this company is heading in the right direction. Buying a used vehicle from Carvana is supposed to be fun and easy, which is certainly can be at the onset. The trouble apparently comes once the purchase agreement has been made. Are we going to see this company in the news with a threat from another state? That is a question that should certainly be in the mind of anyone who plans to use this vending-machine style of car buying.
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