CarMax Inc., the national chain of used car stores, confirmed it intends to open its first Tri-City location within two to three years.
CarMax, based in Richmond, Virginia, operates five stores in Washington, all located in Spokane and Western Washington. Richland will be the first in the area.
“We are pleased to confirm that CarMax has identified the Richland, Washington, area as a good fit for our current growth plan,” the company said in a statement.
CarMax will build an office, parking lot and related facilities at 1261 Tapteal Drive, north of the Columbia Center mall area, according to documents filed under the State Environmental Policy Act, or SEPA. The city of Richland determined the project will not have significant environmental impacts in August.
While CarMax indicated a lengthy development schedule, city documents suggest the project could take shape earlier. SEPA documents indicate work could begin as soon as October.
The project includes two buildings, one for service and the other for sales, with a combined 7,750 square feet. The structures will be surrounded by ample parking.
The property is bordered by Tapteal Drive to the north and the Port of Benton-owned railroad tracks to the south.
It will generate an estimated 249 vehicle trips per day at a rate of 15 an hour in the morning and 20 in the afternoon and evening.
CarMax bills itself as the “nation’s largest retailer of used cars” through its physical stores and online sales. The company is publicly traded and its shares trade on the New York Stock Exchange under the symbol KMX.
It has 230 locations and reported 1.6 million sales and $32 billion in revenue during its 2022 fiscal year, which ended in February.
In its most recent fiscal report covering the first quarter of 2023, results were mixed.
CarMax sold 427,260 vehicles between March and May, down 5.5% from the prior year. However, net revenue rose 21% to $9.3 billion.
It bought more than 362,000 vehicles from consumers and dealers, an increase of 6.2%. In a call with analysts, officials estimated 40% to 45% of the CarMax inventory is priced under $25,000.
CarMax also said the average price of a used vehicle was about $28,800 and that it earned a gross profit of $2,339 per vehicle during the quarter.
“While the used vehicle market environment was challenging in the first quarter, we continued to make progress on the key strategic priorities that enable CarMax to grow profitable market share, now and into the future,” Bill Nash, president and CEO, said in a press release that accompanied the earnings report.
The proposed CarMax site along Tapteal is part of an area targeted for economic development. The cities of Richland and Kennewick are collaborating to connect Center Parkway across the railroad tracks, providing better access to Tapteal and the hotels, stores and other businesses already there.
Richland is the lead on the $6 million project and expects to hire a contractor to begin work this fall. Mail by the Mall, which sat in the path of the new road, moved to a strip mall near Olive Garden this summer.
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