1st Edition of the ‘India Pre Owned Car Market Report’ 2016 released by Indian Blue Book. More used cars are sold in India than new cars.
Indian auto industry has been running on fast track mode which is why it is expected to be one of the major global markets by 2020. The demand for new vehicles has been on the rise which prompted even the pre-owned car market to grow. Last fiscal year about 2.8 million new cars were sold while the pre-owned car market stood at 3.3 million. Just like USA, the pre-owned car market in India is greater than the new car market.
While the growth rate of new car market is about 7-8%, the pre-owned car market is estimated to grow at 15% YoY. The latest survey conducted by Indian Blue Book says organised outlets (like Maruti True Value, Mahindra First Choice, etc.) have a market share of 12% while semi-organised channels constitute a share of 35%. Consumer to consumer sale takes place at 39% while unorganised market share is 19%. Investments from OEMs in the pre-owned car industry are yielding a growth rate of 25% in the organised sector.
Geographically, the Northern region leads the pre-owned car market with 36% share while the West holds 27% share closely followed by Southern India with 26% and East having the smallest share of 11%. About 55% of pre-owned cars are first in the family while 50% of buyers are in the age group of 25-34 years. Affordability and value for money are the reasons for customers preferring pre-owned cars.
Pre-Owned Car Market In India
– Pre-owned car market is 1.2 times of new car market
– 55% sales come from non-metros while 45% sales come from metros
– 50% of the buyers are of age group 25-34 years
– Average age of pre-owned car is 4 years, average cost is Rs. 3-4 lakhs