- Starting on May 12, CarMax’s money-back guarantee will only last 10 days.
- The company started offering customers 30 days to return their vehicles in 2021, in response to the pandemic.
- CarMax says that many customers return their vehicles within 10 days anyway.
Several used vehicle retailers offer money-back guarantees, but in 2021, CarMax introduced what it touted as an industry-leading policy. However, its 30-day return policy may have been a bit too generous, as the company now intends to reduce the timeframe to just 10 days.
Even so, the used car company says that the 10-day offer remains the best in the segment, and is still longer than the returns window of seven days it offered before 2021. CarMax CEO Bill Nash believes that the change will have little impact on most customers.
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“We’re modifying it to 10 days money back, which is still industry-leading,” Nash told investors during an earnings call. And that’s really due to really some experiential headwind, both for customers and associates, which also add increased expenses when you’re talking about most of our customers — a lot of our customers take advantage of it well before the 30 days.”.
“You get past the 10, some people are just working the system,” said the CEO.
Nash admitted that after 10 days, bureaucratic issues can also crop up. He claimed that in some cases, CarMax was struggling to get title work squared away with DMVs and municipalities, creating what he referred to as “headwinds.”
Customers may no longer need 30 days to feel comfortable buying a vehicle, either. In a statement to Autonews, the company said that the month-long return period was introduced during the pandemic, when shoppers had to buy online, and had fewer opportunities to see their vehicles in person.
As a result, CarMax believes that 10 days will be enough for buyers, and will introduce the new policy on May 12. It will continue to honor its 30-day refund guarantee on all vehicles bought on or before May 11, and it has started alerting customers to the imminent change on its website and in stores.
In addition to CarMax, other online used vehicle retailers also have money-back guarantees. Carvana offers a seven-day return period, while Vroom Inc. and Shift Technologies also promised to give shoppers their money back before exiting the used vehicle market.
