One of the sectors that is rising fast in India is the passenger vehicles sector. Data from the Society of Indian Automobile Manufacturers (SIAM) show that in FY24 sales of passenger vehicles in the country touched a record level of 42.18 lakh units, which represents an 8.4% rise from the earlier financial year. But hold on. The pre-owned or used car market is perhaps rising faster and right now reports estimate it at about 51 lakh units.
As many as 1 crore vehicles could be sold in the used car market by FY28, indicate reports.
Used car portal CARS24 chief executive office and co-founder Vikram Chopra told the media in March that the used passenger vehicle market would touch a cumulative revenue of $100 billion in 10 years. To be sure, these are mind-boggling numbers.
But the moot question, which models are selling and why?
Most sold models
The most sold model in the country appears to be Maruti WagonR. Needless to say, it scores heavily on parameters such as reliability, ease of maintenance, fuel efficiency and sitting comfort.
Maruti Swift, Hyundai i10 and Hyundai i20, Maruti Dzire, Tata Altroz, Tata Tiago and Renault Kwid are often mentioned as best sellers in the used car segment.
Almost every car manufacturer from the king of the mass market Maruti to premium brands such as Audi has their own segment of used and certified expanding the choice to buyers.
Why are pre-used cars selling?
The primary reason for the pre-used segment is affordability. With input costs rising, new cars can often pinch one’s pocket a bit too much and used cars can provide an effective way out.
New learners are regularly advised to buy a pre-owned car and master the art of driving with it and only later buy a new one after they become confident drivers.
As the use of used cars expand, the stigma that is attached to the word “second hand cars” is also vanishing as people become more and more prudent and often less emotional in their purchase decisions.
With the used car business quickly moving under the domain of the organised sector, they are scoring more and more on quality assurance. Earlier, when used car sales were largely mediated by local garage operators, the buyer always suffered from suspicion of the quality parameters of the vehicle. But now with popular and premium brands endorsing quality levels, such niggling apprehensions are largely gone.
Certification lends credence
From True Value by Maruti Suzuki, Hyundai PROMISE by the Korean giant to First Choice by Mahindra & Mahindra and Audi Approved Plus from the German MNC, quality certification is going a long way in assuaging quality concerns.
Another big facilitator is the digital presence of the pre-owned car market. Almost all pre-owned car dealers are available on the internet which offers a prospective buyer the liberty to browse models and their parameters from anywhere for as long as they want.
Financing options
Moreover, financing options are flooding the market. Apart from the fact that used cars come cheaper, the prospective buyer can check all car loan options at his fingertips.
All major banks and NBFCs such as State Bank of India (SBI), HDFC, Axis Bank, Punjab National Bank (PNB), Tata Capital, Bajaj Finserv offer loans for buying used cars.
Used car platforms are spicing up their offers with test drives, registration, insurance and name transfer services which can usually be vexatious.
While used-car purchases gathered pace since the Covid-19 pandemic, economic crisis and insecurity around jobs are holding back many buyers from splurging on a new car.
More vehicles are believed to be sold in the used-car market in India than first-hand cars and among the most popular are Maruti WagonR, Swift, and Hyundai i10. What is leading people to buy them so at such a furious rate? Business Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
