What the CarGurus IPO means for auto startups

CarGurus recently announced they will be expanding their service internationally and going public. I’ve been asked by colleagues and the press for my thoughts and here are three reasons why I couldn’t be more excited.

  1. Finally! Automotive gets to have its share of the public markets.  AutoTrader and Cars.com have been operating profitably for over 15 years, but are still closely held private companies (Cox Enterprises, Inc. owns AutoTrader and Gannett owns Cars.com).
  2. All automotive marketplaces will benefit.  As the Founder of Mojo Motors I’m thrilled our category will get attention the other major verticals (real estate, travel, jobs) have enjoyed for years through multiple IPOs.
  3. International expansion is a bold move.  The challenges are significant and margin for error is very thin.  CarGurus’ strategy to go public, then use proceeds and/or stock to acquire existing players is a great idea with some historical evidence. This is how eBay successfully and quickly expanded internationally in the early to mid 2000’s. This same strategy can work in the automotive space, as well.

As 2014 begins making way for 2015, here’s a recap of some of the developments in automotive tech.

  • January 2, 2014 – Cox Enterprises increases stake in AutoTrader to 98%
  • January 21, 2014 – CarWoo shuts down after $16M in funding
  • May 16, 2014 – TrueCar goes public and trades at $9 a share
  • August 4, 2014 – Gannet buys Cars.com for $1.8B
  • October 11, 2014 – CarGurus announces they are going international and public

Expect the automotive marketplace shakeups to continue in 2015 and beyond…


Written by Paul Nadjarian

Paul is the Founder and CEO of Mojo Motors, an automotive classified website where shoppers Follow cars to get alerts when dealers drop prices.

Will driverless cars ever look normal?

In a Mojo Motors poll, 4 out of 5 people said they would not buy an autonomous car if it were on the market today. Even early adopters might be wary of buying a driverless car. It’s tough looking past the unusual design language and that big do-hicky on the roof that looks like a rotor-less helicopter motor.

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To be fair, Google’s prototype would be blind without that chunky Lidar detector on the roof. In its current form, Lidar (Light Detection And Ranging) may be unsightly, but the technology is critical to autonomous cars. It provides a detailed 3D map of the vehicle’s surroundings in real time. This data is run through algorithms that allow the vehicle to identify and react to minute signals such as when a biker signals a lefthand turn. [keep reading]

You’re putting the wrong gas in your car

If you make the mistake of pumping diesel fuel into a gas engine, or vice versa, you’ll know pretty quickly. On the other hand, if you fill up with the wrong octane fuel you might not notice the difference. Putting the wrong octane fuel in your car won’t necessarily result in catastrophic failure, but it could have damaging long-term effects and lead to costly repairs.

the right gas to put in your car

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The handy infographic above shows the recommended fuel type for models 2012 and newer. We hope this clears up any confusion you might have so you don’t end up paying the price for your ignorance. If your car isn’t listed here, refer to your owner’s manual or the inside of your gas cap for the recommended octane.  [keep reading]

How much is my state gas tax?

gas-pumps

The smartest college students in Boston know that on the way back from a ski trip, you’ve got to stop at the liquor store to pick up supplies before you cross the border back into Massachusetts. That’s because New Hampshire has no alcohol tax, whereas Massachusetts takes $4.05 per gallon in taxes from the sale of the standard volume spirits with 40% alcohol.

It turns out that the same discrepancies exist for fuel taxes. In addition to the federal tax of 18.4 cents per gallon (CPG) for gasoline, each state issues unique taxes and fees which are compounded with federal rate.

These additional costs vary significantly across state lines. On the low end, Alaska collects 12.4 CPG for gasoline on top of the federal tax. On the high end, New York collects 50.5 CPG.

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In this study, we’ve taken the federal tax out of the equation in order to analyze patterns and differences in state fuel taxes. Like so many “cost of living” heat maps, the discrepancy between the coasts and the interior of the US is striking. The four most expensive states to live in, according to CNBC, are New York, California, Connecticut and Hawaii. These are also the four states with the highest taxes on gasoline. Fun fact: the fifth most expensive state to live in, Alaska, has the cheapest gasoline taxes. Drill baby, drill! [keep reading]

10 best cars for doing the nasty

Car sex isn’t just for teenagers with no lock on their bedroom door. When you can’t get privacy at home, don’t have money for a motel room or simply can’t wait until you get home to bone, your car may be the only option. Everyone has done the dirty in their car at some point or another. Right?

Toyota Car is Rocking

It can be exciting, but it can also be a bit challenging depending on your vehicle. Since we love providing shoppers with invaluable car buying advice, we put together a list of the 10 best cars to do it in. So turn off the motor, set the radio low, hop in the back seat and get to it. [keep reading]

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Hey America, Formula E is no joke

The newest edition to the racing world has debuted with a bang. On Saturday, drivers took to the course in the inaugural FIA Formula E Round 1 in Beijing, fighting for a place in the history books as the first driver ever to win a Formula E race.

heidfeld-prost-formula-e-2014-beijing-crash

In lap 25 of 25, it came down to Nick Heidfeld of Germany who drives for Leonardo DiCaprio’s race team and Nicolas Prost of France. Heidefeld made his move, accelerating to the outside. The two cars collided, resulting in a spectacular crash that ended with Heidfeld upside down, uninjured but shaken. Brazillian driver, Lucas Degrassi, ended up taking the win for Audi Sport.

At 150mph, Formula E cars only reach speeds two thirds as fast as their Formula One brethren, yet the new electric vehicles offer their own excitement. Apart from the technological feats required to master the nascent technology of electric racers, this crash demonstrated the dynamic acceleration capabilities of these vehicles.

Formula E might be the only motorsport that is quiet enough to allow music to be played throughout the race, but clearly it is no joke. It is also clear that some Formula E drivers are not yet acclimated to the capabilities of their new vehicles. Heidfeld’s last minute decision to attempt an overtake took Prost by surprise and he has publicly apologized to his friend via Twitter, “I understand that I am responsible. I just did not see him, feel very bad.”

nick-heidfeld-nicolas-prost

The winner of the inaugural race, Lucas Degrassi, is likely the driver who is most comfortable being powered by a battery. He was the FIA’s first official test driver during the development of the Formula E Series. If this first race has shown us anything, it is that we can expect even more excitement as drivers gain more experience and EV technology continues to evolve.

Given the waning popularity of open wheel racing in the US, it is no surprise that there isn’t much buzz around Formula E. Tesla has succeeded in proving to Americans that EVs can be sexy, but the company is not even allowed to sell directly to consumers in most states, and we’re all still waiting for that “affordable” Tesla Model 3 that Elon promised us.

We’ve got a long way to go before Formula E takes over our weekends, but maybe that will change once Tesla enters a car in the race, or once we’ve had it it with the National Football League. If you’re interested, the next installment of the ten-race inaugural season will broadcast from Malaysia on November 22.


Written by Sam Jackson

Images: Speede-Formel.de

Shoppers care more about bulletproofed trucks than recalls

A few months back we studied over 35,000 emails to dealerships on Mojo Motors from shoppers interesting in buying a car. What we found was shoppers don’t care about recalls. Only two people asked about them. That’s right, only .005 percent of people asked about recalls. Since that article was published, there have been something like a billion more vehicle recalls and that’s not counting those GM recalls.

truck-with-bullet-holesShoppers now must really be wary of open recalls on used cars. They aren’t. In a study of nearly 20,000 new email leads to dealers since May, not a single person mentioned the word recall. Most people don’t even ask questions as the majority of people (81 percent) use the stock email message. Here’s what everyone else (19 percent) wanted to know. [keep reading]

Asphalt Battles: Cars VS Bikes

The war between cyclists and cars rages on as the “Green Revolution” continues putting more and more bikes on the road. Big cities are used to absent-minded cyclists and delivery boys nearly taking out cross walkers and scratching the sides of cars. Bike sharing compounds the problem, giving novice pedal pushers easy access to a 3-speed so they can run red lights and ride in the opposite direction on one-way streets.

bike-on-road Cyclists don’t deserve all the blame. What about jaywalking pedestrians and drivers that don’t check their blind spot before turning? No one is innocent. The truth is, there is space on the road for everyone, but if no one wants to follow the rules of the road, paths are bound to cross. [keep reading]

How much are you paying per mile in an EV?

You turn on the television and breaking news is on every channel. It has finally happened. The zombie apocalypse. You gaze out your window and see hoards of stumbling, bloody, post-human creatures thirsty for human flesh. A government official advises the remaining population to flee to the safety of a heavily guarded military base 100 miles away. You grab what you can and jump into your electric car, only to realize it has a range of 81 miles and can’t make the trip.

walking-dead-zombies-images

It seems outlandish,  but this is exactly the type of scenario that inhibits people from purchasing electric vehicles. In actuality, the average miles driven per day in the United States is well under 50 miles, yet range anxiety permeates society. Of course, that is not the only impeding factor in the sales of EVs. Even with the sizable tax credits, the technology comes at a premium. [keep reading]

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