Sales of used cars is likely to be double the sale of new cars in India by FY2025, as per a study conducted by Volkswagen along with Frost and Sullivan last year. In FY2021, the used car market sales stood at 3.8 million units, which was about 1.5 times the sales of new cars, at 2.6 million units. The gap will likely widen by FY2025, with used car sales going above 8 million units and new car sales being less than 4 million units.
One of the trends that stood out is the fact that the sales of luxury and premium cars in the pre-owned market is seeing a significant increase as more and more buyers are looking to purchase a pre-owned car in the price bracket of Rs. 25 lakh to Rs. 30 lakh, where a lot of models from the premium and luxury car models are within reach for buyers. A report on ET Auto says that retailers of pre-owned luxury cars have reported that demand for cars in the above-mentioned price bracket has doubled, with models like Audi A4, BMW X1 and Mercedes-Benz C-Class models available. The reason being that the prices of brand-new models mentioned above have gone up by Rs. 20 lakh to Rs. 30 lakh due to BS6 emission norms and significant increase in input costs for all companies.
Ashutosh Pandey, CEO, Mahindra First Choice Wheels, says that the company has seen an increase of 5 to 10 per cent in its monthly pre-owned luxury vehicle sales and gives an example of customers who typically owned cars like the Toyota Corolla Altis, Honda Civic etc. are now moving up to used luxury cars.
The report also suggests that the Rs. 15-18 lakh bracket for new premium sedans has since disappeared, with buyers interested in going further up the price range, even if it means dipping in the used car market.
Source: ET Auto