Automotive retail trends are shifting gears in the age of social distancing, and one local company is trying to keep up with an expansion into vehicle home delivery.
Sweetie Boy Delivers, a car transportation company based in Chesterfield County, is adding to its existing hauling and repair services with a $5 million capital raise to power creation of a contract service by which it would deliver cars to customers on behalf of auto dealerships across the country.
The move comes in response to customer trends toward online car sales, a trend already underway before the coronavirus pandemic, but which owner Tyler McCormick thinks will give the concept more momentum.
“It’s the Carvana experience brought to every brick-and-mortar dealer,” said McCormick, referring to the Arizona-based online used car company that’s been a frontrunner in the shop-at-home car dealer realm.
Sweetie Boy’s capital raise will be used to build out the software and infrastructure to support the delivery service, which Sweetie Boy intends to roll out nationwide in phases starting with Virginia in July.
That infrastructure includes on-the-ground employees and an additional fleet of 10 to 15 trucks for delivery in the Virginia market. Nationally the program would feature an Uber-like setup to dispatch local tow and hauling companies that would operate on Sweetie Boy’s behalf. The company plans to hire an additional 50 employees, which would bring the workforce to 145 people.
McCormick declined to share where the capital raise stands currently, though the raise hasn’t closed yet. Sweetie Boy is seeking angel investors and venture capitalists familiar with the trucking industry to power the expansion.
McCormick aims to deliver 100,000 cars in the first six months of the home delivery operation.
McCormick started the company in 2010, and its primary revenue generator is transporting cars for dealerships, rental companies and auction houses.
He thought up the home delivery service expansion prior to the pandemic after seeing the car retail industry move away from purchases in stores to online buys. He thinks consumers are becoming increasingly comfortable with the idea of buying a car online.
Sweetie Boy will be entering a field already occupied by heavyweights such as Carvana and CarMax, the latter of which introduced curbside services in response to public health guidelines for businesses to limit operations in order to curb the virus spread.
Carter Myers Automotive, which has 15 dealerships throughout the state, announced remote and online services in response to the pandemic in March, including virtual test drives and deliveries of purchased vehicles.
McCormick said he expects dealerships would want to continue offering online purchasing services, but might be reluctant to create in-house teams to handle delivery once the pandemic ebbs away. That’s where he thinks Sweetie Boy will find its sweet spot.
“When the music finally turns back on, they won’t want to lose that. … This is the way the world is going,” he said.