Carvana Co.
Acquisitions
4
Major Deals Covered
$4.4B
Disclosed Deal Value
Carvana's largest disclosed acquisition here is ADESA U.S. (from KAR Global) for $2.2B in 2022. This page covers 4 major deals from 2017 to 2022, each with its price where disclosed and the reason behind it.
| Company | Year | Price | Purpose |
|---|---|---|---|
| ADESA U.S. (from KAR Global) | 2022 | $2.2B | Bought ADESA's U.S. physical auction business, adding 56 sites to expand reconditioning capacity and wholesale capabilities. |
| Car360 | 2018 | $22.0M | Carvana bought Car360 in April 2018 for its smartphone-based 3D vehicle photography technology. |
| ADESA (U.S. physical auction business) | 2022 | $2.2B | Accelerate growth, bolster physical infrastructure and remarketing capabilities. |
| Calypso | 2017 | Undisclosed | Automotive startup to support expanding digital retail operations. |
2022
$2.2B
Bought ADESA's U.S. physical auction business, adding 56 sites to expand reconditioning capacity and wholesale capabilities.
The deal closed in May 2022, just as rates and used-car prices turned, adding to the debt burden behind that year's crisis.
ADESA sites now host new reconditioning capacity and support Carvana's wholesale and dealer services.
2022
$2.2B
Accelerate growth, bolster physical infrastructure and remarketing capabilities.
2018
$22M
Carvana bought Car360 in April 2018 for its smartphone-based 3D vehicle photography technology.
The technology was added to the way Carvana photographs and displays cars on its website.
Completed in April 2018 for about $22 million in cash and stock.
2017
Automotive startup to support expanding digital retail operations.
Since 2023 Carvana has prioritized profitable growth over expansion at any cost. Its playbook: convert ADESA auction sites into reconditioning hubs, shorten delivery times through regional inventory and same-day delivery, widen selection by adding inventory, and lower per-unit costs so savings can be passed to customers as lower prices. It also sells cars through partnerships and is growing wholesale and dealer-facing services on the ADESA platform.
Carvana earns money in three ways. First, it sells used vehicles online at a retail margin; it buys inventory from consumers (its "sell your car" instant offers), auctions and partners, reconditions cars in its own Inspection and Reconditioning Centers (IRCs), and delivers them with an in-house trucking network. Second, it earns "other" gross profit by originating auto loans for customers and selling those loans to investors and securitization trusts, plus commissions on vehicle service contracts and GAP waiver coverage. Third, it sells cars that do not meet its retail standard through wholesale channels, including the ADESA U.S. physical auctions it bought in 2022. Loan servicing is handled by Bridgecrest, an affiliate of the Garcia family-controlled DriveTime, under related-party agreements disclosed in Carvana filings.
In May 2022, Carvana completed the acquisition of ADESA's US physical wholesale auction business from KAR Auction Services, Inc. for $2.2 billion in cash, adding 56 physical auction sites across the United States.
ADESA provided Carvana with 56 physical auction facilities, 6.5 million square feet of building space, and 200 miles of proximity to 95% of US car buyers, providing the large inspection and reconditioning capacity needed to scale toward 2 million retail units annually.
In April 2018, Carvana acquired automotive computer vision and 3D imaging technology startup Car360 for $22 million, integrating its mobile video capture and machine learning algorithms to enhance vehicle photo listings.
Carvana acquired specialized automotive data science assets and software tools to optimize its proprietary algorithmic appraisal engine and dynamic consumer financing risk models.
Carvana financed the ADESA acquisition by issuing $3.275 billion in senior unsecured notes in April 2022 (backed by institutional investors including Apollo Global Management) and selling $1.25 billion in Class A common equity.
Carvana operates ADESA's existing wholesale auction business serving vehicle manufacturers, fleet leasing companies, and auto dealers, generating profitable auction processing fees while securing early access to off-lease inventory.
No, Carvana has intentionally avoided acquiring traditional auto dealerships or franchise lots, focusing exclusively on digital technology, computer vision, and physical auction/reconditioning infrastructure.
Carvana focuses future acquisition evaluations on automation technologies that reduce per-unit vehicle reconditioning costs, improve logistics routing efficiency, and enhance digital vehicle appraisal accuracy.
Yes, in a massive and highly leveraged gamble in 2022, Carvana acquired the physical auction business of ADESA for $2.2 billion to massively expand its reconditioning footprint, a move that nearly bankrupted them when the market crashed.
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