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Vroom Is Elbowing Out the Used-Car Salesman

On Vroom’s website, there’s no haggling and shipping is free.
At its Houston facility, Vroom preps a Ford Mustang for sale.

At its Houston facility, Vroom preps a Ford Mustang for sale.

Source: Mike Welch/Texas Direct Auto/Vroom

About a year ago, violent storms hit the Houston area. When the floodwaters receded, Vroom, an online seller of used cars, discovered it had lost more than 100 vehicles, equal to about $3 million in sales. It was a reminder that the two-year-old Web startup faces some of the same challenges as a brick-and-mortar retailer.

Vroom is one of several companies seeking to consolidate the fragmented used-car market. But unlike rivals Beepi, Shift Technologies, and Carvana, which mostly connect buyers and sellers via online marketplaces, New York-based Vroom buys all of its cars, then refurbishes and guarantees them—much the way a traditional dealer does.