LOTZ - Earnings call transcript Q2 2021

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Operator

Good day, and thank you for standing by. Welcome to the CarLotz 2Q 2021 Earnings Call. At this time, all participants' lines are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. now today, hand Ms. would to conference I speaker your Instructions] like the to over [Operator Susan VP Lewis, of Investor Relations. Thank you. Please ahead. go

Susan Lewis

Good Stoltz, Chief me With Officer. Bor, Executive evening, call Financial of you. Officer Tom Michael Chief Co-Founder on and CarLotz; is and Thank the everyone.

be company's all which conference get we those may which familiar XXXX. suggested the in press as the meaning comparable in statements historical statements used are filings in information measure differ with release. such this the measure today's non-GAAP may with. which forward-looking would language, a includes provided are company's which presentation facts described of materially financial remind you future most measure will risks like Actual Securities The to statements due Before Harbor to to I'm of number call within the not the SEC, our a I from release. results of of this in of be Litigation started, constitute call, Safe supplemental is of to deemed financial financial sure directly you're If press contained Act on this any Reform non-GAAP the Private financial all and GAAP uncertainties,

call Now and the would of I like Bor, to over Co-Founder CarLotz. Michael to turn Chief Executive Officer

Michael Bor

you us to joining quarter and discuss for results. Thank thank you, everyone, Good Susan. second XXXX afternoon, our

to has certainly announcing a year company achieved and while year our gross an date macro and perspective. from pleased outperformed eight It are with industry we new have results. an significantly challenging new our additional but hear, you'll As hubs our web from six profit guidance, record quarter our guidance, Having growth very second busy we a met exciting launched perspective a GPU experience, opened been unit hubs.

that significant and became hired since began we we impacting talent and model. across Tom a last actions public further quarter discusses sales, the more what both color hub company, locations, this have accelerate After cars to the effectively that from Tom? the disruption All results, our major our being confidence continued marketing we source and our technology experienced experience number markets is the ability and current business our we accounts macro will of scale. the options. six initiatives in said, company, growth unit wholesale I'll desirable executing taking support long-term second commercial to we most give to consignment our months on Over and finally, about doubled continue believe in are environment,

Tom Stoltz

Thank you, Mike.

our For the to please our full of in Investor details available section press our regarding Relations release refer website. financial results,

pleased our were profit and As XX% million, increase results Revenues Mike of year. unit were increasing mentioned, an with we growth. second for XX% XXXX, strong Retail gross revenue versus achieving last versus year. quarter, are sales the last $XX.X unit

in year-to-date Additionally, as XXX% for to XX% revenue the period, the and grew unit period same six-month sales increased XXXX. compared

depreciation of Total on in in $X,XXX. our mix and and year-over-year expenses, over importantly, to and quarter an front-end by sequentially quarter market. loss increased year-over-year in management to in second of combination SG&A QX by during $XX from The a compensation penetration million over year growth to on increased first vehicles. compared which million strategy home XXX% a sequentially and of revenue by due of revenue we're XX% overall in selling the a car $X.X QX incremental $XXX,XXX retail SG&A services in changes this increase increased to price benefited total increase a loss quarter XX% Gross this GPU sold. excluding to last million. the and in a quarter $XX.X average was of staff in and to our sales, year loss the in technology period F&I the million was XX% was addition our of Retail Our marketing quarter net $XXX,XXX stock year. And were first and the last QX of GPU in support driven nearly In last and inventory unit significant our Retail increase the to a products XX% last the in year's units a year of driven driven penetration $XX.X compared million year. profit price and costs investments, $X.X increase higher Adjusted in our of $X.X quarter QX profits growth loss relative increases a execute the to in QX in QX. same finance XXXX. XXX% used million for million increases $XX.X to for loss year-over-year insurance pricing last compared million last EBITDA and a in and loss and began $XX.X

turning forward. Now which our of cash We provides marketable million, quarter second securities and meaningful the us with sheet. balance to $XXX ended flexibility going

second during plan was with credit increased the our facility Ally million. to floor Additionally, $XX quarter,

Now our regarding outlook.

a of predict profitability we us volumes clear in For vehicles. view to our supply need and into have business, to our

marketplace, substantial needed uncertainties about QX, to Mike shift appropriate pause industry determined further relationship We course seasonal pricing able this part, it illustrate with environment with at year. normal to in the decision, QX appropriate delivery our the combined time. when the expect schedules. consigned to to this at we led difficult corporate is dynamic, of pressure we and and to mix the that the further that therefore, due inventory to apply discuss for been guidance is the based our action. will currently believe a have was historically To will the of given the appropriate the predict our remarketing to this macro this the largest this predict balance the in withdraw over our course will but depreciation, have the on inventory profit return these the owned to new consigned timing volumes, we visibility to supply of primarily lack vehicle of versus chain clients portion, of new of Due beginning in conditions our partner, inventory, auction. in gross owned with purchased inventory confinement XX% that mix nature Our

group expected, resulting our were in a hubs new addition, we well units of while whole new gross inventory, beginning originally as as are profit pressure. of the as when not In also hubs predominantly at the performed selling the we consigned ramping year quickly

issues see over QX QX of Gross expect seen As profit we through Mike elaborate QX, due a end to in shortly. the result, in unit qualitatively, compression while we have year on which will to we today, growth continue that the the continue to

consignment investments I'll to light in turn we expect the ahead second long into continue tactical Mike now over environment. to strategic of call and we this establish to are operating and term. sales from marketplace Looking to the a plan to the of in visibility, to the half scale current vehicle to of year, the nationwide base discuss which how make the further our despite near-term necessary lack we

Michael Bor

Thank Tom. you,

that that have While we we're we very disruptions in this we delivered seen it's the macro these the year, results that further sourcing with QX headwinds. light of important pleased articulate

disruptive issues they are are to our why chain facing supply the discuss we model. business I'll uniquely First, and

new late actions cars long-term to the in offering of used respect to about we're supply retail clients. in prices of the decreased And prices, investments starting resulted making consignment the the shortage our chain, available the and to into less in increasing light wholesale the address discussed rapidly taking wholesale our commercial I'll the Second, availability relation mitigate which With third, cars specific and success in clients. disruption. remarketing we QX, the being to QX the broadly of our appealing talk chip fewer are I'll retail prices ensure growth business. to service became increase through In and

exacerbated challenges. largest corporate pause partners further decision to in Our these consignment consignment May

begin performed similarly this sourcing to well inventory sources on third seen we to second continue to-date quarter and attractive have the prices sourced until became But peak auctions expect we to wholesale begin with market an the which we in We challenging QX in the quarter, and more peers pricing other recede, competitively was as rise. prices at our unusually competitive as unprecedented to reasonable a inventory Additionally, see to challenging. compared environment from profitability and normalizes.

reason option performance costs new return market less our are to is our normal inventory Carrying consignment predictable their It's to excited we model the increase sourced clients us consignments. hubs. to for of Our structures utilized believe our owning frankly due we to so inventory. why fee with inventory, strongly provides the the profitability and accounts, desirable higher business acquisition at our than more and impacting in the

the first are While which new anticipated in to all are have selling our inventory and reliant mix, in experiencing lower performed price first on due term. our higher up, long to openings we several well two the our growth to younger year-to-date of achieve of our hubs. days, sourcing than hub we eight we new With openings age with hubs sell-throughs stop had XX more coming and part performance

disruption? we have we To things. to did about appropriate two what this get done So inventory levels,

and more of owned we increase now overall were channels, our though heavily June, our preferred. much balance to from competitive we sourcing inventory inventory than began towards is into we competitively and First, able weighted available more much sourced heavily even the anticipated inventory

which upgrading through Two, and Three, with One, building we attempting early of are that are consumer to address our when profitability, in longer-term of impact a expect footprint consignors had promising have initiative normal, and the short-term we've our business? industry campaign. industry, five, our materialize, results. our ever which Second, to are to the have growth we the consigned seeing taking actions our inventory. but market to believe growing are are new relationships long-term the than ensure continuing profitability. a geographic will the we have of top doing positive continue we investing we we are we're grow corporate our some on sourcing consumer grown time success our is sourcing, what more impact mix doing significantly and marketing unit the and what grow Four, Outside we to the to so of brand and improve Growing to we and continued to heavily to are take we team. technology. will we returns our access in to

me these discuss of initiatives. Let each

groundwork have continue the set as a previously to of had advantage which normal. the plan we take First, presence to much and market larger returns national to for we we than

capacity. of number of the year doubling which the more so opened the have operate, country, most attractive eight hubs processing than locations far inventory We and this in new doubling markets our in and across some we

also far strong our additional will so have to put to the year We goal in us infrastructure that a believe unique our conditions six when model national announced position business new adding our We build for hubs. hubs of take continuing way of industry to advantage our normalize. XX on out XX to

to major proud, not buying because used campaign pragmatic. we ever first very concept brand recently because people brand consignment. they're are the independent cheap, many vehicle our highlights campaign that and or doing have our consigning smart, so to Second, they're The introduce they launched designed our are awareness and of increase guests

than and driving In legacy greater support the digital, will provide in markets. hub brand support and previous more sustained this effective television. sales, radio key unit it We social, look new and addition believe believe and across campaign to will reach marketing awareness initiatives, launches for building have our campaign we

technology or process, hub in as the will buying easy online, possible. we're facilitate by vehicle making that Third, initiatives whether driving sales as

we the experiment to to needs and we website which quarter, guests, in-house, operational new with test enhanced and our our improved identify control brought and to second the of the give and features. the ability believe adapt infrastructure us During will stability, specific ability

we believe app of the launch the markets. profitability. of also the focus to of outside We new our that Fourth, to continue will guests development website direct buy and on further mobile our our enable

efforts with quarter this their timely F&I with seek As center market to effective we by year-over-year consignment normalize. to and and operations. remarketing we've our strong our relations new increased mentioned, to relationships be build to continue retail partners cost up sufficiently conditions corporate ramp nearly we expect continue processing we And and fifth, them as - revenue XXX% ways

our consignment relationship. corporate our in an fact, In our restarting interest expressed relationship who recently has paused in May partner

our early inventory other We long-term our investments infrastructure of have are and signs re-accelerates. market too us With strategy in of inventory to our tell top to our from model, continue XXXX started account our seeing it's and consignment proposition. relationship we place anticipate and receive and consignments of take believe volumes fully value To about that in months pricing seeing they the but return the lower cars small with to their and accounts, new risk will these vehicles anticipated volumes light In to that again reiterate, significant will with in this business to closing, increase meaningful enthusiastic advantage we believe have how position from until relationship the still early of the right me respect be of human volumes greater over consignment eventually of asset of predictability. favorable the accounts more we clients overall our meantime, back, but seeing the In some profit normal manufacturers. we will from to sourcing. consignment made only the retail-wholesale new deliveries coming have more don't put We several inflows resources from last when experiences OEMs. a in consignment the their confidence it our

We returning with our to our have changes desired the corporate consignment that that long-term in seen market structural our We mix. are from sourcing would not believe partners us relationships prevent strong. eventually model any

our our growing in We growing our also hub are while our also awareness technology. brand significantly operations, enhancing consumer consignment network investing and

through prouder team quarter We our through Retail couldn't gross this GPU want the of are the model what growth. delivered disruption. has how and reinforce a believe to challenging optimistic we is long-term short-term navigated revenue, strong about as business navigate unit, and that be I I profit we of success

We this to making in for investments while our strengthening and operate current will foundations on continue focus changes the future, efficiently tactical environment. to

questions. your take now will We

Operator

[Operator from Instructions] the Sharon comes First line Blair. Zackfia of William question of

Sharon Zackfia

an the our But And I just the of Hi. to dynamic about. and pace hub of facing was the internal that opposed in kind guess I externally the industry-wide that sell-through. there given all to certain as stress you lot guess related stresses almost able to new to some you're that to maybe right a now, sound seeing how referring talk so Good is afternoon. are you're related there openings growth? I'm there how

Michael Bor

lack for do of new to Sharon, on what impact types to see I the they we've increasing are question. events predictability mean, key events our we're that the end our vehicles course beginning are has in sell. clients. Thanks, year we related have the see This to is my profitability in because meaningful a of number over close being to sell. to of. cars with it. from they we our dramatically don't we a COVID anything never old big with. history we Yes. cars this seen one. their I the seen are the rapidly the to related coming - reduced like ability source Yes, these accounts new like prices of two the wholesale the mean that the that consignment that And And industry the the of to having of delivered that it have These And are cars to the industry replace

getting shifts prices but as as to in we mix increase an our getting wholesale accounts. that know, versus related prices, regularly from of today also higher not types you we're to retail types in a So, from just for that option of meaningfully the inventory is our were due the just inventory and example, price, at inventory the the

fastest. used is XX% now that plus $XX,XXX percent that and in example, under inventory probably about be our obviously an XX% and turns inventory range to of As the it's that XX%,

confident we're impacting are macro pretty And fairly these us the of uniquely huge industry that we're are trends a so part that stressors seeing.

Sharon Zackfia

metrics any radio I to trajectory, a then are traded know that you Chicago. sourcing secondarily, but how points having companies longer-term the ramping. kind of guess ads, we're not that, really Can kind and consumer hearing from in the talk a there. mean, kind you at of other price would I out that might mentioned helpful. follow-up there at And about bulk be guess consumer I've publicly that least, heard they're I be of that's I

CarLotz than So others that aware more sees we're why some of? do you of maybe that think the

Michael Bor

is have you Did consumers say said? balk, you what that

Sharon Zackfia

of Because that consumer seeing Yes. they with with if as the you're one prices, issues new the and think far prices that I to being resistance ramps hub appear thus companies doesn't have the mentioning reported higher the any makes sense. of that are it other

Michael Bor

$XX,XXX you a that $XX,XXX, what number has started Maybe higher, of volume and car. been Yes. enough. company can $XX,XXX people can versus is that imagine, we the is our range much $XX,XXX than selling the can afford We clear the the in people we're my looking - fewer since vehicles $XX,XXX who as wasn't a are that and or of $XX,XXX average number of are $XX,XXX far the afford car for to point

teens has the in teens-to-high from as up And this over pushed there inventory of it's to - the of high year, last getting. we're course really teens. average several years types the the result meaningfully a Our been low of over

been have 'XXs. gone have business sell-through rates in we lot on Now of kind we a in higher vehicle, inventory, we brand a type teens, model ever the good than the the always and inventory but are average we've based believe that both our our has rates of for and selling the that sold building been not we're into past the how priced predicted sell more through which

sell-through and selling the it that course points, this new that over that the we've comes are at a at is that it's averages the of less price it's of different we're history. a So than company's seen inventory balking type consumers

Sharon Zackfia

recent have of then on kind sourcing, do And the consumer uptick you on Okay, that's any there? metrics the fair.

Michael Bor

Yes.

So increased consumer and as we consignment consumer for through you marketing, sourcing mentioned, buying. through have both sourcing through

our of consumer small they so the was hefty prices with retail. up in and less prices very get sourcing shift dropped like were consignment when meaningful dealers kind the the and could consumers of from dramatically compared offering to prices a as became have to We ramping corporate seen that consignment base found wholesale it just accounts due uptick a off wholesale temporarily enticing

kind trends, it's but that we're to As our of the seeing seeing the group on sourcing and wholesale-retail in those we're gap, improvements on we're in results to pricing revert normal muscle really early so structurally, good also we're turning seeing we're marketing consumer significant improvements based and that so seeing very efforts. specifically

Sharon Zackfia

And then openings, hub last is pausing of question. environment some external you Have just delaying the or given kind of challenging? the considered

Michael Bor

will We haven't environment to it's mean return I OEMs will to not very to predict happen. will yet. - but the the to that hard begin very it difficult deliver when predict pricing obviously when structural normal, it's

so hubs we buyers more predict good back forward. is a it to the able And guests, what sellers, more covering of when. growth going have But reach having that idea we go of do don't just is normal, business more know to country, of more that will we being drive what the this will

of pyramid, still at our believe with being hubs to with really we with developed. the at the top this so business ability the And grow really of bottom the new strongly pyramid, in

Sharon Zackfia

Thank you. Okay.

Michael Bor

Thank you, Sharon.

Operator

Barrington the Research. Prestopino of Next Gary comes of question line from

Gary Prestopino

cars higher have selling high at days, couple average points, hit questions selling a increased that if you're here. increasing? price are relatively selling A then they how depreciation taking average and a The days afternoon. you for the Good much given probably of

Michael Bor

don't I mean I that. believe Yes,

Tom Stoltz

end quarter. sold quarter, through had that, we at disclose really I the of first went would as QX don't say on but we Yes, early inventories down the actually we the

were sell QX, on new the the we to sell that difficult to source the that new slowed we inventory and And it at some. and in more so we're inventory the that hubs of during got our so solely looking at as inventory trying were and of actually part mix and because was those more new of first actually we it QX some And then towards of accelerated was relying values throughs end in probably hubs. for fully time auction get pronounced were full for hubs point through the more

Gary Prestopino

about I bit, sale out All is matter to to increasing are down maybe definitely - retail? right. the days if right. was come of has little two come have and pricing, the you're go inventory going over a but months mean from prices right, at fact and much Well or you has - how the pay for had All starting and at are retail down a to you've much talking where there, so your to ago is up last squeeze weeks margin the of it couple though average how are that

Michael Bor

know that and will it we a Yes, depend heading does you difficult that. of all the to and likely do type into last point price I because half on on we vehicle mean of know of and year. it's location pressure give number is What the GPU that face

I some think do part of this year, time seasonal. see mean, you is into it QX. that and is of pressures typically I

back have to a front really support all seeing XXX% really F&I have with end job we nearly it on helpful overall solve - GPU. done the pressure, it And back-end the end doesn't quarter-over-quarter. start that's Fortunately, as growth we does more growing we but is problems, that phenomenal

Gary Prestopino

you lag starts you your with lag So you how a of bulk of business of cars up months, production, as back time at think there's from up for much sequentially ramping production XX we to ramping going eventually starts model the where benefiting the be your that much how the go consignment do as you be OEMs start a are now? say, purchasing and versus up, before to it doing really get could the

Michael Bor

they have question, they how are our that. cetera. That's going not but up ramp to - guessing, in distribute. attempted channels been the what clients, rental manufacturing. reality And order past Gary. businesses, through In distribute we've dealers I They or There taken I in to et going to past are which clients calls would the think, on one several to volumes still right mean, we've so great are quarters we an and I'll clearly that step what to hasn't happened in, spring ago they pulling and were that towards closer late do they they our mystery, are. that deliveries, they do you months in pointing they and the on thought were we the begin that tell a chain they get is summer, and early that are a supply when

the to when So we their guess their clients as deliveries can and even talk best in we'll do is our resume. But best will to throwing of hands get guessing. up there terms kind of

Gary Prestopino

And just question. last then

$XX used we six to the next You the a going to cash of six year. months burn of million that months? the cash for Are first see similar

Tom Stoltz

you're flow floor the I Yes, There an offset financing. to operations. think plan from the number and the that is from with pulling statement cash

a of part $XX are in that that inventory in a a floor There that of first XX. then seeing the are see quarters of had six That burn million, $XX think, as good we've CapEx months You year offsets of $XX build also operations of and so I well. ended. the about about of $XX two cash plan we the in from means million million been million some the have

the year. of something seen the probably So of for this half first that's comparable half will what that it and we've over be last

Gary Prestopino

you. Okay, thank

Michael Bor

Thanks, Gary.

Operator

from comes Barclays. of the question Our next Karen Short of line

Karen Short

ASP what kind versus calendar Thanks and we're think may much. settle of the couple the by a I'm time out where of questions, of - is you historicals first, sense now a end it year? very give you the of wondering can us

Michael Bor

ASP. Yes. Yes.

teens. don't were but has last up. ASP the this it's meaningfully. point, within know So low exact years, gone the in the couple number We gone of quarter, for I were, we up the at

and we XX, that are is XXXX, I the in the gone XXXX prices just and rise high in Obviously, think over by we've XX. teens the of of part end over cars. into of meaningfully

So same a would is gone were not we're higher we same exact high priced car, selling teens, we're the to car, the exact done we have selling if the from low-teens the but car. guess my

as As it down where although as it quickly we probably while, forward bit went might will we take to or as to come much wholesale will probably will continue settle up. not down go higher prices that we think do as been it a as expect a or priced the selling. come total it we've went And sell in we cars up, that

likely in we lower ASP comes in point, started price that to price but lot build - those will point, seen lower which the at vehicles we following the ASP our to. for and cars sell-through back, much XXs, certainly, think volume the do to looking forward as frankly certainly that With we've sub will cars. more good that higher a a see we down of we're consignment I a buyers brisker the bring than ASP cars, at pace expect

Tom Stoltz

as of important turn consignment, cars ASP Particularly not profit. in terms flat overall to on when to quickly want us and the we're more a is of fee program, really gross we

Karen Short

It's where relevant No, but is of for I you, okay. a landscape the just question is overall understand that. that

corporate how elaborate actually partner? Michael, you my to indicated is, that Who, progressing the your resume looking just on was on So the are just what and a relationship? guess, could second question you little I with conversations bit conversations are the

Michael Bor

Yes.

we May, them. we recall that which to from would they So of attractive to very that the were get in We sell prices, decided revert to kind would wholesale-retail began a very at then seeing in they to as call quick them understood. pause normal, did that when spread tremendous they, give relationship you'll wholesale anticipate because increases pricing opportunity

very of last We over coming small It's seeing weeks. reached restarting the them. we handfuls cars we're started the and and weeks in the said early vehicles we're with of like they be to taking still excited last would but couple out to cars working again. Within proactively couple in good the of start relationship, you sending

Karen Short

last I the reliant to question you've you past the question, why given guess better that kind back the landscape you're opening consumers, pause just are a consign that obviously the new a in then hubs vehicles until take from prior less is on able that new versus much to wouldn't my equilibrium? Okay new and reaches used hub, and indicated more of hub in

Michael Bor

several the reasons. negotiating little runway opened, There are a finding hubs locations, to Yes. getting of these leases, One there bit is them is set a up. getting

back rid companies new what of. nine gap or with disruption these our years. happens is consistent And this retail part not that before COVID so these in the that And trickling the of believes it was to they that we're go ready planned that but for what issue industry We unless that driven still seen with over is we've or getting get the historical experiencing and prices this more XXXX, really to year consignment prices in now, norms, kind we've structurally attractive we're eight, offer. of country that's chain why, having for and needed reaching hubs production for offering still the where into confident or in hubs but is very will last right excited business we're was levels that wholesale the this even to kind OEM the growth It's we that cars of that and at will very cars our XX and opening. that our years before old to to return to operationally to through remain most new we're supply on unfortunate revert a the predicated not get anyone

Karen Short

Thank that's you. Okay, helpful.

Michael Bor

Karen. Thanks,

Operator

the comes from of question Deutsche Rosner Bank. [Operator line Instructions] of Emmanuel Next

Emmanuel Rosner

Yes. Hi. everybody. Good evening,

Michael Bor

are you? Emmanuel. Hi, How

Emmanuel Rosner

good. Good,

the pricing obviously how wholesale normalize, sort to you you business? channels. is lack high these selling question, What going definitely industry it sort like first one side, they speak I'm large is automotive the as they're coming pricing. you from would seem about have cars able new clients increased they factor do say level. the And the of unfolds mentioning then two predict just are forward, that trends new to like production of and your so you're still it to still to impact thinking the reason cars could not but view get being way selling And at around they the headwind, no at through but you on it pretty all the sort wholesale a find I also of when new ones automakers consignment see are different your of like be terms doing partners, in a do it but or find cars typical that larger of can't because can So

one So to is you're just curious which most able if impactful, tell?

Michael Bor

I Yes, added driver. say I to but that one key whom with would relationship. of accounts mean work inventory the a they tell We, have our exactly, met key would we I to - in resources on is our lack with driver, work hard to is top recently, the with of -

of are several to list to fraction tiny getting they - the the meaningful to units units they they We their cars then opportunity times do of seeing at that to a is sell, but new day few sell that they be look were out clients. would what do have it deliveries have a the send to of if can

new haven't and We frankly is flip and strong. still these age growing top everybody so and our can of eagerly just and clients with that the corporate their and work fleet. our team account top shown of the reduce cars arrival relationships in very - bring are really up yet, strong have a people frustrated fleet and their with our accounts that they are them, we of anticipating management So we

key a one. that's So

price said the and previous pricing, calls, the in On pricing is the high. up we being problem, not going this the

we pricing now anticipate return. off gap will do between seeing the the recede, So that we're and to the level begin retail wholesale that and

be So consign it the retail and price and issue it's gap won't we who of wholesale be are our that when and will clients be, trying to the be, visible issue eventually, an smaller portion returns to cars. will believe, and that the should

Emmanuel Rosner

Okay. And gap where between towards that is of for there for it reaching units like So a wholesale not timeline to retail traditional you're and thinking consignment? piece? a sort but the makes OEM more piece, partners give your sense level the specific

Michael Bor

well tailwinds the seeing it's are haven't the Yes, you just to changes past. some see it, difficult we're to end beginning the I that And of let there. we'll know structural positive predicted very in we - beginnings just we very that the mean, of

Emmanuel Rosner

Okay.

these of vehicles, conversely sheet, to have for sourced you balance like and have we do you're And sort should quarters? issues business well? about shifting on of you how to Do actually think to multiple that the How are to Do able sourcing that? team are I you of of execute that? good a ongoing, the sort still able you goes while be well like sort like run these some - if to bit position then, competitively so are of a the little a then guess structured

Michael Bor

one compared provided great as the the as Yes, about amount executed of how the capital, this I the - of earlier mean in it tremendous transaction of especially had we much a year capital history ever business. we we've us in to things

done, existing $XXX experienced processing are quickly. - We're end on with of we've to basically building the the them relationships overall - getting if need centers with inventory new relationships prepared quarter strengthening the teammates cash back our do of of a We're job so up. the be hubs. We're normalizes. who in of the who new when are are staffing done the tremendous we opening at market - the accounts, accounts, amount talented, sheet doing for up to these and balance very and million ramped And kind what come volumes getting hiring

Emmanuel Rosner

about actually curious I'm Yes. that before happen. the

period at suboptimal to this like do ways of So because meantime? of quarters or are between actually the business you look sourced until should the like quarters like make conditions things the sort decent we intermediary way now business of have a in normalize those and

Michael Bor

are much as having question. mean not now. source a our that's to of right to as good inventory we well, we from accustomed auction Yes, are I

a is experienced good built a we've auction. done of meaningful at in so, quantities team of as they've And at GPUs. lot vehicles QX, of that evidenced inventory sourcing a And very great selling job

we we than like and in that's will is the sold experience of inventory do it's new GPU good type third to and little it. we've fourth of we it quarter, a become do taken anything think we head time to different get us, and we then be a in at challenged - into the been it, bit As mentioned, like past but

up at takes not at volumes of to we selling any So we come give little and throwing inventory some hard that at to be hubs until our of hubs consignment experience. really and new time back. professionals all We're saying a gain successful up are working of and old hands bit kinds but price point

Emmanuel Rosner

Thank Understood. you.

Michael Bor

Thank you.

Operator

no Please at to time. would Michael ahead. am conference to I like the back now Bor. Mr. this further go questions turn I showing

Michael Bor

you. in Thanks who to today. everyone Thank dialed

we're the scale As disruption I in we in market, we while growth to creating volatile when earlier, complicated and business this market returns some strategy a this said we confident unusual the experiencing we driving our normal. believe open are the you half are consignment foundation to during long-term remain and We're and evening. marketing very hubs, again and speaking to forward a We have newly opened and drive strategic invest ramp looking to back technology the to market nice as and continue Thanks to hubs forward results. of soon. year look with in

Operator

you today's for concludes participating. this Thank conference call. gentlemen, and Ladies

You may now disconnect.

CarLotz (LOTZ) 10 Aug 212021 Q2 Earnings call transcript