Carvana, the online car retailer that made its name selling used vehicles, is now selling new cars too.

The company started in 2013 with an unusual idea: a glass tower vending machine that dispensed cars in Nashville. The broader idea behind Carvana is that buying a car should be simpler and less stressful. Instead of haggling with a salesman, you pick a car online, pay a transparent price, and have it delivered to your home. If you don't like it, you can return it within seven days. That week of driving gives you a better sense of whether the car suits you than a quick test drive at a dealership ever could.

Carvana has grown this system over the past decade. By 2019, the company had put 20 vending machines in operation, including its first in California. These aren't just novelties—they're part of how the company operates. More recently, Carvana started offering same-day delivery in Indiana, meaning you can buy a car and pick it up the same day.

Selling new cars is harder than selling used ones. When Carvana sells used cars, it buys them from various sources, fixes them up, and sells them directly. With new cars, Carvana must work with manufacturers—Toyota, Honda, Ford, and so on—who decide how many cars each seller gets. There's also another obstacle: state laws that were written to protect traditional car dealerships from companies selling cars directly. Tesla has spent years in court fighting these laws, state by state. Rivian and Lucid have done the same. Carvana will face similar battles.

But plenty of people want an alternative to traditional dealerships. Buying a new car at a dealership often means hours of negotiation over price and finance charges. If Carvana can offer the same low-pressure experience for new cars that it already offers for used ones, many buyers would likely switch.

The real challenge is what happens after you buy the car. New cars come with warranties, and manufacturers handle recalls through dealerships. Carvana has its own financing operation, but it's never had to manage warranty service and recalls on a large scale. That's a new problem to solve.

Carvana has faced tough times recently. The company lost a lot of money in 2022 and had to restructure its debt in 2023. Adding new cars to the business while still recovering financially is risky—this isn't a move a company makes from a position of total confidence.

Still, the plan makes sense. Carvana already has the logistics network—the vending machines, same-day delivery, and return policy. The question is whether it can arrange the manufacturer partnerships and comply with state laws while also running the warranty and recall operations. That's where this expansion will ultimately succeed or fail.