eBay Acquires Caravel: Simplifying Online Car Sales

eBay Acquires Caramel to Streamline Online Car Transactions

eBay, the prominent e-commerce platform, has announced its intention to acquire Caramel, a company specializing in facilitating the concluding stages of vehicle sales.

These stages encompass crucial elements such as identity verification, securing financing, managing necessary documentation, transferring ownership, and arranging insurance coverage.

Adapting to a Competitive Landscape

As eBay has matured, continuous adaptation has been essential for maintaining its market position.

For example, the company recently eliminated seller fees within the United Kingdom to effectively respond to emerging marketplace competitors.

Specifically within the automotive sector, eBay has strategically acquired several startups to bolster its capabilities.

These acquisitions include Cargigi, a provider of advertising and marketing technologies, and Motors.co.uk, a classifieds website based in the U.K.

Amazon's Entry into the Automotive Market

Last month, eBay’s long-standing competitor, Amazon, also entered the online car sales arena with the launch of Amazon Autos, a collaboration with Hyundai.

Currently, Amazon Autos focuses on the sale of new vehicles directly from dealerships, however, future expansion to include used cars remains a possibility.

Securing a Leading Position in Used Car Sales

eBay’s ultimate goal is to solidify its position as a trusted and efficient platform for used car sales.

This is particularly important given the increasing number of options available to consumers.

Caramel's Background and Funding

Founded in Los Angeles in 2021, Caramel officially began operations last year after securing $19 million in funding.

Investors included FJ Labs, Hearst Ventures, Zeev Ventures, and Primera Capital.

Furthermore, in July of the previous year, the company completed a previously undisclosed $21.3 million Series A funding round, led by FirstMark Capital.

How Caramel Facilitates Vehicle Sales

Caramel’s services can be integrated with sales initiated through independent dealerships or online marketplaces, including eBay.

During the checkout process, Caramel is offered as an option to verify buyer and seller identities, manage title transfers and registrations, and facilitate secure fund transfers.

Buyers can also explore financing options and arrange for vehicle delivery through the platform.

Enhancing eBay's Existing Services

While eBay already provides some support and services to simplify online car sales, such as escrow services for holding funds, integrating Caramel will significantly accelerate the process.

This integration will alleviate much of the administrative burden associated with post-sale procedures.

Building Trust and Preventing Fraud

Chris Prill, General Manager at eBay Motors, emphasized that the acquisition is primarily focused on “creating trust” within the vehicle buying process.

This will help both buyers and sellers avoid potential scams.