MEMPHIS, Tenn. — With a name like ‘Vroom’ the word “fast” may come to mind.
However, customers of the online car dealer who turned to WREG say the experience has been anything but.
In fact, the News Channel 3 Investigators uncovered thousands of complaints against the company, including customers who say they’re paying for cars they still technically don’t own.
Customers Forced to Wait
Billy Smith says his family’s RV is large enough to sleep eight, has a kitchen with a refrigerator and space for eating, as well as a bathroom with a shower. Smith said it has all the comforts of home, which is perfect for their family pastime of enjoying the outdoors.
“My family and I, we like to go on trips. We’ve gone to places like down by the Gulf and down Florida. We’ve gone to Talladega for the races and several things like that. We really enjoy going out with the RV and going camping,” Smith said.
Smith upgraded from a pop-up camper to his current RV two years ago.
“I started getting older and the girls started getting older, we needed more room and I wanted something a little bigger.”
Smith says he also needed a bigger truck to pull the RV, so he bought an F-150 pickup in September of 2021.
Smith purchased his pickup from the online car dealer Vroom.
It’s a site where customers complete the entire car buying process online and the vehicle can be delivered directly to their doorstep. The company even offers financing.
The Vroom website reads, “Buy your next ride entirely online.”
Smith said the purchasing process ran smoothly and he likes his truck. But there’s one big problem.
Smith isn’t driving his new truck. It’s parked.
“I took possession of it on September the 27th of 2021 and I have, to this date still haven’t, had been able to get the vehicle registered,” Smith said.
He says he’s been waiting on Vroom to send the proper paperwork so he can register his truck and get a tag.
The company issued him four temporary tags and told him they can’t send another one.
“I still got the last one on the vehicle and you can see it expired on February 13th,” explained Smith as he showed WREG the now expired temp tag.
Smith said he’s made seven months of truck payments, and has gotten four temporary tags, but zero answers from Vroom about the delay and when they’ll make it right.
“The response from them is when you call them, which is the only way you can get to them, they have a system set up where you talk to somebody who is obviously looking at a computer screen and all they can tell you is what they see on the screen. They can or will not give you a name or phone number to anybody else higher up who can deal with your issue,” Smith explained.
He says the entire experience has left him frustrated and a little angry.
“I have seriously have spoken, at least I know more than 50 times. I’ve made phone calls here. At least 50 times. And of all of that, I’ve gotten maybe three emails saying that they’ve got this case number. It will be reviewed and that’s the last of it.”
Smith is far from alone in his complaints about Vroom.
Matthew Vanderbloemen is a different customer with the same story.
“You sit on hold for 30 minutes and you find out that the person that you end up getting 30 minutes in has no idea what you’re talking about,” said Vanderbloemen.
Vanderbloemen bought an Acura from Vroom in September. He relocated from Washington D.C. to Memphis where he now needed a car.
Vanderbloemen told WREG, “It was really when the first temporary tag expired at the end of November that I started to notice that there were going to be some issues. I started to wonder, do they really, are they really paying attention? Do they really know what’s going on? Are they really handling this the way that they should?”
Vanderbloemen says by January he reached out to his lender and they hadn’t received a title from Vroom. He showed the News Channel 3 Investigators emails to and from Vroom.
He says the company would repeatedly ask for documentation he’d already provided, or that wasn’t even required, such as an emissions test in Tennessee. He says Vroom told him they were going to close his case due to missing documentation.
“They say, hey, we need further information from you. This is on December 10th. They say we need an emissions test and proof of insurance. I had given them that proof of insurance, on a full month prior to that. It tells me they’re not connecting the dots, telling me they don’t know what’s going on, that they’re poorly managed,” said Vanderbloemen.
Vroom has corporate headquarters in New York. The company has operations and a presence near Houston, Texas and is a licensed dealer in the state. The temporary tags issued to Vanderbloemen and Smith were from Texas.
In federal filings, the CEO of the publicly traded company touted record sales and revenue. The company said it had sold 74,698 ecommerce units, which was up 117% year over year. Vroom called its ecommerce segment the “largest segment in our business” in SEC filings and said revenue for that segment grew 166.8% from 2020 to 2021.
There have been more than 5,000 complaints filed about Vroom with the Better Business Bureau of Greater Houston and South Texas over the past three years.
The BBB revoked Vroom’s accreditation and the company has an “F” rating.
Dan Parsons is the president of the Better Business Bureau of Greater Houston. He said it was “unprecedented” to have that type of growth in complaints that quickly.
“There’s a funnel and the funnel is our inbound complaint activity. Vroom just greatly exceeded the funnel. I mean, it spilled all over the sides of it.”
Complaints range from customers getting damaged cars to unauthorized contract add-ons, and title and registration delays.
Parsons told WREG, “Usually complaints pigeonhole into one or two areas. These are in many areas. Most of it does circulate around not getting titles and registration or not getting the vehicle. And then the subset begins. Then you get into other things like, well, they never submitted the title and we caught them in a lie saying so, or they’re blaming on a DMV office that’s perfectly open and operating. Or then you can flip over to the car side and say, well, the car that was advertised looks beautiful. And the one I got, it’s a piece of junk.”
Parsons says complaints similar to the stories Smith and Vanderbloemen shared with WREG also surround Vroom’s customer service.
“You can’t reach a manager. We have no supervisors. We will escalate your, we will take this to a tier higher. It’s all babble speak to make you go away,” exclaimed Parsons.
The NewsChannel 3 Investigators asked Parsons, “How have they responded to the complaints?”
Parsons replied, “Generally, not. Generally they don’t.” According to the BBB of Greater Houston, Vroom has failed to respond to nearly 2,000 complaints that are now closed.
Complaints haven’t stopped at the Better Business Bureau.
The Texas Department of Motor Vehicles says it has received 1,688 complaints against Vroom in the past 12 months.
A spokesperson told the NewsChannel 3 Investigators, “We cannot discuss the details of open cases, but I can confirm there is an active investigation involving Vroom.”
A review of closed cases filed against Vroom with the Texas DMV includes a number allegations such as the following:
- Failed to timely transfer title
- Selling vehicle without having title
- Misuse of buyer e-tag
- Failure to provide title to out of state customer
“Failed to Timely Transfer Title” was the most cited allegation type of the closed complaints reviewed by the NewsChannel 3 investigators.
The Texas DMV records reveal Vroom has faced six fines totaling $37,500 since 2017. The penalties were associated with complaint investigations, including those settling claims of failing to timely transfer title.
After speaking with WREG, Smith filed a complaint with the Texas DMV. An investigator wrote in an email, they found “evidence of a violation” in his case.
Smith said, “I would have much rather, had they told me they had problems, they were backed up, shorthanded, whatever the issue was, I would have much rather they told me that at the beginning, straight up been honest with me and told me sorry, but it is going to take six months to get it registered for these various reasons.”
Vroom wouldn’t give WREG a reason for its delays, either. The company declined our interview requests.
In an emailed statement a spokesperson said:
“We regret any customer not having the positive experience Vroom strives to deliver. We are aware some customers are experiencing delays in receiving their titles and registrations. We are actively working with Mr. Smith and Mr. Vanderbloemen to resolve their issues as quickly as possible so they can fully enjoy the vehicle they purchased from us.”
In our review of closed complaints from the Texas DMV, we found multiple occasions where a Vroom executive claimed titles had been lost. In a 2021 case, a Vroom Compliance VP wrote to the Texas DMV Investigator assigned to the case, “Apparently this is a transaction for which we cannot locate the title and the seller, Tesla, has promised to provide assistance.”
The investigator notes in violation recommendations two days later, “There should be no reason if the title was lost that the RP could not obtain a duplicate title for the vehicle and transfer title unless the previous owner’s signature is needed. It is suspected that the RP sold the vehicle in this case without title in hand but unable to prove that at this time.
“…also believe RP is and has been selling vehicles without title in hand.”
There’s a line in each of the entries for Enforcement History in which investigators typically note a number of cases against a respondent. In this case the investigator wrote, “You know, A lot.”
Texas Attorney General Sues Vroom
Another agency has accused Vroom of not having the titles at all.
On April 19, 2022, The Texas Attorney General filed a lawsuit against Vroom alleging deceptive trade practices.
The filing accuses Vroom of “reselling vehicles before they even obtain clear title”. It said Vroom “designed a system that fails to meet the Texas legal requirements for timely transfer of title and registration”.
The suit, which includes the BBB complaints and data from the Texas DMV cites a complaint from a customer who says they waited a year for a title. It also cites problems for out of state consumers, some who complained of “multiple citations or impounded vehicles while displaying Texas temporary tags”.
The lawsuit calls for an injunction to halt certain practices, civil penalties and restitution. A spokesperson for the Texas AG’s office says the restitution would go directly to consumers.
A Vroom spokesperson said of the lawsuit, “Our goal is for every customer to enjoy their car buying and selling experience with Vroom. While we can’t comment on the specific allegations, Vroom has worked with the Texas Attorney General’s office cooperatively to address the issues raised in today’s suit. We are disappointed the Attorney General felt the need to take this action but intend to continue to address these concerns and to continuously improve our operations to ensure a hassle-free experience for our customers.”
As of April 29th, Vroom had not filed a response to the lawsuit and no hearing had been set.
Parsons said the lawsuit was long overdue.
“I’m glad that finally it’s happened and now there’s light on this thing. We are aware there may be other other ones coming down the pike, including at the federal level,” added Parsons.
He continued, “This has hurt consumers. People are out their car, their livelihood has been affected, they’ve been arrested, they’ve been stopped by the police.”
Latest with Mid-South Customers
Vroom is now paying for a rental car for Smith. He said Vroom told him the paperwork was now at the DMV and that he should expect things to be complete by mid- to late May.
However, Smith said he just wants to get his pickup registered so he can put his RV on the road, and Vroom behind him.
“It sounds kind of corny, but what I want right now is I want to put Vroom in my rearview mirror and be done with them,” he said.
Smith said he shared his story to warn other potential customers. “From my personal experience, I would be cautious and I would verify multiple reviews,” he said.
Vanderbloemen finally got his car registered and got a tag. However, he says that only happened after he managed to get a direct phone number to a Vroom representative who’d helped one of his relatives.
Even after that, Vroom sent him an email saying they were still missing documents.
Florida Agency Takes Action Against Vroom
The Florida Department of Highway Safety and Motor Vehicles filed an administrative complaint against Vroom in January of 2022. It alleges 47 counts of “not transferring a vehicle title in accordance with Florida law.”
The order states Vroom had title transactions that were 90 days or more late and had pending transactions that had not been completed or cleared out of the system within 30 days.
The Florida DHSMV fined Vroom $23,500 in a settlement agreement based upon the above administrative order. According the records, Vroom did not respond to the complaint in a timely manner, so the fine was increased to $47,000, which equates to $1,000 per violation.
What Can Customers Do?
There are a number of steps customers can take if they are having problems getting their vehicle registered with Vroom. Based upon our investigation, reaction may not be swift, but taking some action has helped some customers.
- File a complaint with a state regulator
- File a complaint with the BBB
- Keep contacting Vroom, maintain records
- Customers who were issued temporary tags out of Texas can file a complaint with the Texas DMV and the Texas Attorney General.
- Here’s what a spokesperson from the Texas DMV told News Channel 3. “The Texas Department of Motor Vehicles (TxDMV) shares the frustration of consumers who spend a significant amount of money to purchase a vehicle but encounter problems when Texas dealers do not follow the law to transfer the vehicle title. We investigate every complaint and take action to assist with resolution of issues on a daily basis. The goal of all TxDMV motor vehicle investigations is to correct or mitigate consumer harm whenever possible and to educate and sanction dealers when appropriate to deter future violations. In cases concerning late title transfers, investigators work to locate and facilitate transfers for consumers in addition to gathering evidence to support violations against the dealer.”
- In WREG’s review of closed complaints at the Texas DMV, Vroom executives responded to investigators, even if it didn’t result in an immediate change or answer for the customer. Investigators assigned to each case probed details and noted company responses.
- When Smith filed his complaints, Vroom responded faster with the option of the rental car.
- Customers can also file complaints with the agency in their state that regulates motor vehicle dealers, handles titles and accepts consumer complaints.
- In Tennessee for example, both the Tennessee Division of Consumer Affairs and the Tennessee Motor Vehicle Commission accepts complaints
- The News Channel 3 Investigators found approximately 40 complaints filed against Vroom with state regulators in Arkansas, Mississippi and Tennessee since 2020.
Arkansas Customers Don’t Have to Wait to Get Tag
The News Channel 3 Investigators spoke with Arkansas Commissioner of Revenue Charlie Collins about a process the state has where residents can get their vehicle registered without the wait.
“Essentially we get people on the road and then we have a title processing system and that happens in the background,” Collins said.
“If you purchase a vehicle somewhere other than Arkansas and you have the sales contract and you, have a note from where you purchased it, whatever dealer that is saying that they are working on the title, that should be enough to get you on the road here in Arkansas. So if you’re going to register that car here, we’ve got a process that’s going to work for you regardless of where and how you buy the car.”
Avoid Pitfalls of Online Car Buying
Whether it’s Vroom or another dealer, consumer advocates say customers should take some additional steps when purchasing vehicles online.
Mid-South BBB President Randy Hutchinson said to be wary if the dealer doesn’t offer you, “tons of pictures of the car from every angle.
“As for a Carfax report, most, many dealers will provide that free. Or in some cases I think perhaps you can get it on your own. But do your best to test drive it. It might be a good idea to arrange your financing before you go in,” said Hutchinson.
Check for active licensure
Check for disciplinary action taken against dealer
Read customer reviews
Beware of sellers that try to rush deals