Purchasing any automobile, especially a car is a major buying decision. It is an indicator of the individuals’ progress in life and hence the car market of any country serves as an indicator of the country’s economy and industrial growth. India represents one of the largest car market in the world. Used car market has seen unprecedented growth over the last few years aided by the online car buying classifieds. The ever rising prices of new cars combined with the global economic slowdown have pushed a majority of new car buyers to think of owning a pre-owned car.
This market is slated to grow enormously in coming years as used cars are much cheaper than new ones. The low depreciation on used cars attracts many buyers. Some experts say that used car market is the future of automobiles. Small dealers and customer to customer sales still dominate used car sales in India. Mechanics and workshops also double up as agents to help people in buying or selling old cars. Rising income levels among the middle class couples with easy availability of finance on pre-owned cars has given a major spurt to the demand of used cars. Another factor that is contributes to the rising demand is that the buyers have become more comfortable with the concept of driving a used car.
A study reveals that hatchbacks are the most popular amongst the used car buyers and the cars from top players like Hyundai, Maruti and Tata Motors are very much in demand. It is also interesting to note that despite the rising prices of petrol, people still prefer petrol cars over diesel cars. Just 45% of buyers in the used car market choose LPG, Hybrid and Electric car. Diesel car buyers form around 42% of the market. Maruti is the frontrunner as far as the customers’ choice of old cars is concerned. Maruti Swift and Maruti Alto are bestsellers followed by Tata Indica, Hyundai Santro and Honda City.
Buyers give precedence to manual transmission over automatic transmission gearbox. Buyers are ready to pay up to 2 lakh for purchase of a pre-owned car. A total of 41% of buyers allot a maximum budget of 2 lakh and this indicates higher sales volume of cars belonging to A and B segment A major chunk of sales is reregistered from metropolitan cities like Mumbai, Delhi, Hyderabad, Chennai, Kolkatta, Pune and Bangalore as these cities offer a wider range of options in terms of pricing and also in terms of cars.
Though the pre-owned car market is slated to get even bigger in years to come, it is relatively smaller when compared to the used car market in countries like United States or China. With the entry of branded companies in the Indian market, the small players in the used car business have been badly hit. Also, launch of several web portals that offer a good and reliable platform to prospective buyers and sellers of old cars has severely affected the business of small players. The rising presence of well known car brands entering the pre-owned market segment will hopefully benefit the buyers in the long run as the middle players get eliminated and transactions get more transparent.
Looking to buy a pre-owned car? Check out the latest listing of used cars at Autportal