Replies to post #6305 on Consumer Automotive Finance Inc (CAFI)

[AskMrOwl]

arbpro

CarMax has a small portion (maybe 5%?) of its business dedicated to doing what NWAU is doing with the high risk financing and marketing to the high-risk portion of the population. The past year this small portion of the business has outperformed the rest of CarMax's main business to such a high degree that CarMax restated future earnings guidance for the business as a whole upward significantly. It is true that this segment of the business does substantially better than the used car sales business as a whole.

[opsrex]

As a former Operation Manager for Carmax, let me say that you cannot compare the two companies. At my Carmax (in the Chicago area) I had 30 technicians, 3 service advisers, 2 service admins, 1 service manager, 1 production manager, 1 parts manager, 3 parts associates, 1 inventory manager, 6 painters, 6 detailers, and 12 inventory associates. This was just on the back end. Add in the business manager with 8-10 business office associates, the buying department which consisted of a purchasing manager and 6-10 buyers, the LGM and his admin, 5 sales managers, and god only knows how many full and part time sales associates, coupled with a lot that covered several acres and you have margins that are below 5%. Obviously you cannot compare NWAU and KMX.


I sold all my KMX stock and bought NWAU.