CarMax is a Fortune 500 company based in the United States that specializes in used cars. The company was founded in Richmond, Virginia, in 1993 by Circuit City Stores Inc.
The company has transformed car retail in the United States, but it also faces numerous competitors and alternatives.
Table of Contents
- Brief History Of CarMax
- Top Competitors and Alternatives to CarMax
In this article, we will talk about top CarMax Competitors and Alternatives you can look out to buy and sell your cars.
Brief History Of CarMax
CarMax is the largest retailer of used cars in the country. In addition, it is a Fortune 500 company. The first CarMax store opened in Richmond, Virginia, in September 1993. The company expanded to 195 sites as of November 30, 2018.
CarMax experimented with curbside sales in early 2020, as industries such as CarMax and others sought to continue operations in the aftermath of the Coronavirus COVID-19 pandemic.
CarMax’s curbside pickup program will allow customers to acquire vehicles that comply with the country’s physical/social distance requirements. Additionally, the organization continues to provide consumers with home delivery services.
Top Competitors and Alternatives to CarMax
|Founder||H. Wayne Huizenga|
|Headquarter||Fort Lauderdale, Florida|
AutoNation is a United States-based company that provides automotive dealership services and used vehicle retailing.
AutoNation was founded in 1996 by Wayne Huizenga, and it has over 360 locations in the United States, with its headquarters in Fort Lauderdale, Florida.
The company offers 1Price Certified Pre-Owned cars and a Money-Back Guarantee. In addition, customers have the convenience of having their vehicles inspected and certified.
CarMax is the nation’s largest reseller of secondhand automobiles. On the other hand, AutoNation generated the majority of its revenue in 2019 from new car sales.
The percentage of new vehicle sales in 2019 was 54.9 percent, while the percentage of used vehicles in 2019 was 23.9 percent.
Finance and insurance accounted for 4.6 percent of income, while parts and services accounted for 16.1 percent. The two companies are nearly identical in terms of revenue, with AutoNation slightly ahead of CarMax.
2. Sonic Automotive, Inc.
|Company Name||Sonic Automotive|
|Headquarter||Charlotte, North Carolina, United States|
Sonic Automotive is the fifth-largest automotive retailer in the United States, with over 100 locations and a fleet of 25 car models.
Sonic Automotive opened its first twenty locations in 1997 when it was founded by Bruton Smith. Sonic is ranked 298th on the Fortune 500 and is a member of the Russell 2000.
The company had employees of 9,300 as of 2019 and sales of $10.45 billion.
The revenue generated by Sonic Automotive in 2019 was about half that of CarMax. The company built 100 new standalone used-car locations in 2014 to compete with CarMax (the market leader in this segment).
CarMax remains unaffected five years later and dominates the used automobile retail industry.
3. Penske Automotive Group Inc.
|Company Name||Penske Automotive Group Inc.|
|Headquarter||Bloomfield Hills, Michigan, United States|
Based in Bloomfield Hills, Michigan, it is a worldwide provider of automotive dealer services.
The company operates in Western Europe, the United States, and Canada and is a Fortune 500 company. The company also offers diesel engines, gasoline engines, and other automotive equipment and services.
Additionally, it sells both pre-owned and new vehicles. Penske Automotive employs 26,980 people. The company made $23.17 billion in revenue in 2019.
Penske Automotive is a major competitor of CarMax. However, it earned slightly more revenue than CarMax in 2019.
Penske Automotive is the second-largest dealer of new cars in the United States. Still, it revealed last year that it is increasing its used-car locations to improve revenue and profitability.
The question now is whether this will help them expand their lead over CarMax.
|Founder||Ernest Garcia III, Ryan Keeton, Ben Huston|
|Headquarter||Tempe, Arizona, U.S|
Carvana is a division of DriveTime, an automotive retailer and financing company.
The company separated in 2014 and now operates as an online vehicle dealership, where customers can purchase, sell, finance, or trade-in a vehicle.
The company’s 18 car vending machines provide customers with the option to pick up their vehicles or have them delivered.
Customers can exchange or return their cars within seven days of purchase if they are dissatisfied with them.
Carvana, known for its one-of-a-kind, multi-story automobile vending machines, is a relative newcomer to the industry. The company entered the market seven years ago. The company’s revenue is more than six times that of CarMax.
Carvana is one of the fastest-growing used automobile dealers in the United States.
5. Asbury Automotive Group
|Company Name||Asbury Automotive Group|
|Founder||David W. Hult|
|Headquarter||Duluth, Georgia, United States|
The Asbury Automotive Group, founded in 1995, has its headquarters in Atlanta and operates all over the United States.
Asbury Automotive, a Fortune 500 company, is the seventh-largest automotive distributor in the United States.
Its headquarters are in Duluth, Georgia, and David W. Hult, the company’s founder, chairman, and CEO leads the business. There are 80 dealerships and 96 franchise locations in ten states operated by the company. In addition, a total of 25 collision repair centers belong to the corporation.
Asbury Automotive Group had 8,200 employees and a revenue turnover of $6.87 billion in 2019.
Asbury earned the most money from the sale of new vehicles in 2019, accounting for 53.6 percent of its total revenue.
The income from used vehicles accounted for 29.5% of the revenue, with financing and insurance accounting for 4.4 percent.
CarMax’s revenue in 2019 was derived mainly from used vehicles. Yet, it generated more than three times as much revenue as Asbury in 2019.
6. Auto Trader
|Company Name||Auto Trader|
|Headquarter||Atlanta, Georgia, United States|
Sanford Schwartz created Autotrader in 1997. Today, it serves as an online marketplace for buyers and sellers of automobiles. It purchases new, used, and pre-owned cars from dealers and private sellers to resell them online.
Additionally, the site provides essential information in the form of reviews, recommendations, and vehicle comparison tools that assist clients in navigating the worlds of financing and insurance.
Autotrader operates in the shadow of its parent firm, Cox Automotive, which also owns Kelley Blue Book, Xtime, and Manheim. Manheim is the world’s largest wholesale vehicle auction company. As a result, Autotrader’s income is a fraction of what CarMax made in 2019.
However, while Autotrader is a purely online marketplace for automobiles, CarMax has physical and online locations.
Autotrader employs 859 people. The corporation claimed a $1.1 billion revenue turnover in 2019. Autotrader is a wholly-owned subsidiary of Cox Automotive.
7. Lithia Motors
|Company Name||Lithia Motors|
|Headquarter||Medford, Oregon, United States|
Lithia Motors, Inc. is a retail automotive retailer and dealership based in Medford, Oregon. Lithia is the third-largest vehicle retailer in the United States, with 180 locations in 18 states.
Lithia reached position 294 on the Fortune 500 by 2018, indicating its tremendous success.
The corporation has six subsidiaries: DCH Auto Group, Prestige Auto Stores, Day Auto Group, Downtown LA Auto Group, Carbone Auto Group, and Baierl Auto Group.
Lithia Motors is the United States’ third-largest dealer of vehicles. It employed 14,320 people in 2019 and generated $12.67 billion in sales.
Lithia Motors is one of the industry’s top five auto dealers, vying for the ultimate title. The company’s revenue has gradually increased over the past few years, increasing by 7.2% year over year in 2018.
Lithia Motors’s 2019 revenue, although slightly higher than CarMax’s, still needs more work.
8. Enterprise Car Sales
|Company Name||Enterprise Car Sales|
|Headquarter||St. Louis, Missouri, United States|
Enterprise Car Sales was founded by Jack Taylor, the man who created Enterprise Rent-A-Car.
Enterprise Car Sales is a subsidiary of Enterprise Holdings, the leading car rental company in North America.
Enterprise Car Sales is one of America’s most renowned used car retailers, with over 120 locations. They do not sell new vehicles, and their inventory includes over 250 different models of older vehicles.
|Founder||Mitch Golub, William Swislow, Alex Vetter|
|Headquarter||Chicago, Illinois, U.S.|
Cars.com is a United States-based website that was founded in 1998. Cars.com ranks second among car classifieds sites. Classified Ventures LLC owned the company previously.
Car.com, which is based in Chicago, is a well-known and respected automobile classified advertising company.
The website is one of the most popular used car classified websites in the United States. Cars.com is also a subsidiary of DR Media Holdings. There are 1,300 employees, and the company generated $606.7 million in revenue in 2019.
Cars.com is a classified advertising website for automobiles. Its primary function is to connect automotive buyers and sellers, and it does not own the vehicles for sale.
The company generates revenue by selling online subscription advertising packages to automobile dealerships and original equipment manufacturers.
It is one of the most popular cars classified websites in the United States. However, it falls short of CarMax in terms of market penetration and revenue.
Copart was founded in 1982 by Willis Johnson. The company provides online automobile auctions and remarketing services in the United States, Canada, the United Kingdom, Germany, Ireland, Spain, Finland, Brazil, and the United Arab Emirates. The company is headquartered in Dallas, Texas.
Copart’s key customers are dealerships, exporters, rebuilders, and dismantlers of used cars. Furthermore, the company sells to private individuals.
Copart sells vehicles primarily to insurance companies, car rental firms, fleet managers, government agencies, and automotive dealers. The company generated revenues of $2.04 billion in 2019 and employed 7,327 workers.
Both Copart and CarMax are automobile sellers, but Copart is an auction house, and CarMax is a vehicle listing company. Copart primarily sells to other auto resale companies, but it does sell to private customers as well.
However, CarMax primarily sells to private parties. As a result, the revenue generated by CarMax was around ten times more than the revenue generated by Copart in 2019.
|Company Name||Inchcape PLC|
|Founder||William Mackinnon and Robert Mackenzie|
Robert Mackenzie and William Mackinnon founded Inchcape in Calcutta in 1847 under Mackinnon Mackenzie & Company (MMC).
Inchcape and Company were renamed in the 1950s and later became Inchcape PLC in 1981.
The company sells automobiles and distributes them. Inchcape is headquartered in London, United Kingdom, and operates across 33 countries in Europe, Africa, South America, Asia, and Australia.
The corporation employs 17,300 workers and generated $12.45 billion in revenue last year.
Inchcape has no operations in North America. However, it operates in 33 other countries worldwide, where it sells new and used automobiles, vehicle components and also offers vehicle financing and insurance.
Inchcape will face off against CarMax, the used-car powerhouse if it enters the United States. However, CarMax must expand outside the United States before it can challenge the global leader.
12. KAR Auction Services, Inc.
Kar Global, located in Carmel, Indiana, was established in 1989. The company employs over 15000 people and operates throughout Canada, Mexico, Europe, the United Kingdom, and the United States.
The organization is thought of as a forward-looking innovator when it comes to remarketing. They develop products used by a wide range of leasing companies, banks, and professional dealers.
12. Manheim, a subsidiary of Cox Enterprises
Manheim is one of the top car remarketing companies in the United States. In addition, this company offers buyers and sellers access to the most prominent car exchange network.
Over 115 digital, physical, and even mobile auctions assist dealers and businesses with inventory management.
TrueCar.com is an automotive-related website based in Santa Monica, California, that uses car pricing, information, and other facts.
TrueCar is used by several dealerships to collect personal information from new leads and potential clients. In addition, the TrueCar network provides users with an online report summarizing car pricing information from several dealers.
Carfax is a web-based service that provides vehicle history data to consumers and businesses interested in purchasing used vehicles. The corporation is headquartered in Centreville, Virginia, and operates in the United States and Canada.
Carfax offers several complementary and valuable services, including myCarfax, which provides car service information and recommends needed maintenance.