Trouble For Carvana As Dealer License Suspended

Industry News / 9 Comments

Carvana loses the ability to sell cars in the state of Illinois, again.

UPDATE: The Carvana dealer license has since been reinstated.
Carvana is in the news again for all of the wrong reasons. The once darling start-up of the online used car buying market has seen its stock plummet, layoffs begin, delivery of a customer car go horribly wrong, and now its dealer license has been suspended in the state of Illinois. While Carvana is very efficient at taking your money in exchange for that used Honda Civic you've also dreamed of, it just can't seem to produce titles for the cars they sell to register them in your state.

The problem stems from Carvana missing registration paperwork for the cars it is selling, with buyers having to wait months to legally register. As a result, the Illinois Secretary of State Police has enforced a temporary suspension blocking Carvana from selling used cars in Illinois.

Carvana

Carvana has been in trouble repeatedly for selling cars that cannot be registered in the buyer's state as the title is nowhere to be found. Instead, Carvana is issuing temporary paper registration from other states and expecting car buyers to drive around on it while they hunt for the title.

Multiple complaints from owners prompted a suspension of Carvana's Illinois dealer license. In some cases, Carvana has issued up to four or five temporary out-of-state registrations so buyers could use the cars. But this is contrary to Illinois state law that said an out-of-state vehicle had to receive the title within 20 days of the sale. Furthermore, any temporary registrations had to be done in Illinois.

Illinois state officials first suspended Carvana's dealer license on May 10. Then there was a stay issued on May 26 allowing Carvana to shore up a number of existing cases but the Arizona-based company failed to continue proper operations.

Carvana has been in trouble a fair bit this year for the exact same practice where buyers have been unable to register their cars after taking delivery. In Florida, officials issued a mandate for a January 31 deadline that almost had Carvana's dealer license suspended in that state as well. North Carolina banned Carvana for 180 days over tag and title problems as well.

This latest news follows the Carvana announcement of a 12% staff cut, with 2,500 employees laid off while the company's stock price has been in freefall over the last year, with an August 2021 share price of $370 that has plummeted to $28.21 today. The good news is that they still have the industry's only car vending machines.

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