America's largest used-car dealer, CarMax ($KMX), has stopped selling Teslas ($TSLA). In September, the entire CarMax inventory only showed 3 individual Tesla VINs, and in October, not a single Teslas was listed.
At one point not too long ago, Teslas were increasingly available at CarMax, with as many as 343 individual VINs available as recently as February 2019. But by March of 2019, that number dropped to just 146 cars.
We called our local CarMax to see if they still sell Teslas, and we were simply told, "We no longer sell Teslas."
Since last summer, used Tesla prices began a rapid descent. As we reported last year, in October 2018, the average used Tesla sold for $87.000 at CarMax. By December of that same year, the average Tesla price dropped to $60,400 — a drop of 31% in just a couple of months.
The price decline of used Teslas came as inventory swelled and the cars continued to age. By September, before they disappeared entirely from CarMax's inventory, the average Tesla was selling for less than $45,000. The declining price had a lot to do with aging Teslas as well as a small number of less-expensive used Model 3s becoming available, but the trend was clear.
It's unclear why CarMax has ceased used Tesla sales. It's possible that Tesla is looking to maintain control of aftermarket prices. It's also possible that CarMax is simply choosing to stick to cars that are easier to rehabilitate and warranty.
It's unlikely that what we're seeing here is the former, as Carvana's ($CVNA) Tesla inventory has picked up recently.
In fact, Carvana's uptick in Tesla inventory appears to pick up right when CarMax ceased sales. If this is Tesla's attempt at reeling in aftermarket values of its cars, it will want to take a look at Carvana prices, which are seeing a similar downtrend.
By October 2019, the average Tesla sold for $43,400 at Carvana, down from $57,300 at this time last year.
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