As has been the case for some time, vehicle affordability remains CarMax's biggest challenge. Persistent inflation, higher interest rates, tougher lending standards by banks and other financial service entities, and low consumer confidence all affected CarMax's ability to close transactions. These challenges could remain in place for some time, but used car prices have moved somewhat lower, translating into a US$1,600, or a 5.5%, year-over-year reduction in CarMax's closed used car transaction prices in 1Q FY24.