How Will High Luxury Car Demand Strengthen India Used Car Market?
A number of factors, such as the increasing consumer preference for high-quality automobiles available at affordable prices, burgeoning demand for imported cars, and high depreciation rate and plunge in average new vehicle ownership duration, are expected to drive the Indian used car market at a notable CAGR of 14.8% during 2021–2030. According to P&S Intelligence, the market was valued at $18.3 billion in 2019, and it will generate $70.8 billion by 2030. In recent years, the surging popularity of online marketplaces and classifieds has become a major market trend.
The burgeoning demand for luxury cars, on account of the soaring disposable income of people, will drive the demand for used cars in India. To meet the demand for premium cars, a number of retailers are providing imported and premium cars in the country. For example, Big Boyz Toyz Pvt. Ltd., offers used luxury cars of Jaguar and Land Rover manufactured by Tata Motors Limited, BMW AG, Cadillac by General Motors, and Lexus by Tata Motor Company.
In the coming years, the offline category will account for the largest share in the Indian used car market, under the sales medium segment. This will be due to the extensive customer preference for procuring a used car from a known dealer. The physical storefront of traditional brick-and-mortar retail establishments is more appealing to Indians than online sales medium, as it is very important for customers to take a test drive and browse different options before purchasing the vehicle.
In 2020, Maharashtra generated the highest revenue in the Indian used car market, owing to the massive depreciation value of luxury cars, boom in young population, and rapid urbanization. In addition, the growing internet penetration and soaring disposable income of customers will also contribute to the market growth in the region. As per the Ministry of Housing and Urban Affairs, the total population of Maharashtra is around 50.8 million, which is the highest in India.
Hence, owing to the growing consumer preference for pre-owned vehicles and plunging average vehicle ownership time period in India, the sales of used cars will soar in the country in the coming years.
