The demand of used cars has risen recently because even the middle class families now aspire to have their own cars. Due to this, many OEMs have entered in the used car market. It has now begun to be very organized. Many luxury car makers are making an entry in the pre-owned auto market while other existing manufacturers are expanding their business by increasing new outlets.
Changing lifestyle of Indians, user choice, favorable demographics, etc. are a few reasons why this used car segment is growing rapidly. Also, the availability of loans on used cars has become much easier. Many online portals have also contributed in explaining the buyers on the viability o buying used cars. The main challenge which this market is facing is the emergence of new cheap cars.
85% of the used car market is still highly unorganized. The main role is played by a car agent who is the link between the buyers and the sellers. It is actually risk buying car via these agents because they can swap the original and genuine parts with sub standard, cheap and duplicate parts. This increases their profit margin.
Lot of hype was created last year since the Rs. 1 lakh Tata Nano was launched. By end of this year the used Nano would enter the second hand car market. This would be available at a very cheap price. This would further prove to be a boost for the used car market in India. As per one of the leading consumer portal, in a month they receive approximately 25,000 used car queries. Out of these 40% of the people actually buy cars. Around 65% of cars used by people in Delhi, Jaipur, Haryana, Banglore and other major Indian cities are used. With the help of online portals, people are provided with excellence guidance for which car to buy.
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