KAVAK Expands Operations to ArgentinaBy Alejandro Enríquez | Wed, 08/26/2020 - 16:52
With four years in the market, KAVAK is the market leader in Mexico for purchasing and selling used vehicles online. KAVAK CEO Carlos García announced that the platform will invest US$10 million in Argentina, its first venture outside Mexico, over the next 18 months. "This international step is really important for us. Argentina is a market we love; in Mexico used-vehicle trade goes around US$60 billion every year, while in Argentina the figure is close to US$20 billion," told García to Forbes México.
KAVAK is a Mexican startup backed by SoftBank Group Corp, a Japanese holding with a diverse investment portfolio in Latin America with a value around US$5 billion, Reuters reported. As part of its plans for the Argentinian market, KAVAK purchased Checkars, an online platform also dedicated to online used-vehicle trading. "We are happy to communicate the merger between Checkars and KAVAK, joining forces to consolidate the leadership of used vehicles e-commerce in Latin America," wrote Juan Cruz, Co-Founder of Checkars, on a LinkedIn post. "We join a spectacular human team, with a disruptive vision and ambition. Our mission is to create a technological hub in Buenos Aires to keep building a global product," he added.
García also announced the merger via LinkedIn. "This is our first step within our international expansion plan, strengthening operations in Argentina while ramping up Buenos Aires’ position as a technology hub, which undoubtedly will continue to add talent to the region," he wrote.
KAVAK has quickly regained pre-pandemic levels in June and expects results to be even higher in August, Reuters reports. In June, during an interview for Mexico Automotive Review, García affirmed that the pandemic will influence consumers’ preference for a safer transportation alternative. "What we are seeing in countries that have passed the first stages of the pandemic, such as China and Germany, is that consumers are choosing private vehicles over public transportation. People are prioritizing social distancing, which will be reflected in the growth of private vehicles sales," he said.
You can read our full interview with Carlos García here
The company’s success in the Mexican market is mostly due to its focus on improving customer experience selling a car or looking for a used model. "We are obsessed with finding new alternatives for our customers under a fully digital experience or through a personalized experience related to the vehicle. We work to reduce the unnecessary time our customers spend when looking for a new car. We are very passionate about our consumers," Garcia told Mexico Business News.
KAVAK has more than 2,000 vehicles listed on its platform. For vehicles to be listed, they need to pass a 240-point inspection to guarantee their optimal condition. Customers can also test the vehicle and return it if they are not satisfied. "We are the only platform in Mexico with a unique seven-day or 300km return policy. To offer that, we conduct an excellent reconditioning and inspection of the vehicle. Moreover, despite the market’s informality, we can provide access to financing schemes through traditional banking institutions," said García.
When asked about his five-year vision for KAVAK, García said at the time that in five years, the company will be operating in a few more countries across the region, with a market share similar to that in Mexico. “Our headline will be: KAVAK building Latin America's best team," he said.