The pre-owned passenger vehicle segment is almost the size of the new car market and has slowly but steadily ebbed the unorganised sector.

However, the pre-owned organised market for commercial vehicles is still in nascent stages, with the bulk of it
still controlled by unorganised players.

Shriram Automall, a wholly owned subsidiary of vehicle finance major Shriram Transport Finance, is trying to
organise the sector by building a platform or marketplace which will facilitate meeting of buyers and sellers of trucks, small commercial vehicles and tractors.

The platform will help the organised sector in making headway in sales of pre-owned commercial vehicles.
The reach of Shriram Transport Finance in the domestic market will help this subsidiary to track buyers for used commercial vehicles.

The Automall also provides financing options for potential buyers as banks and other financial institutions do not provide loans for buying used commercial vehicles.

Started in 2011 on the outskirts of Chennai, Shriram Automall has 52 outlets across the country with another
8-10 outlets about to be opened in places like Pune, Nagpur, Saharanpur, Lucknow and other places.

In the last fiscal, the company performed transactions worth Rs 1,750 crore. Every month around 10,000 transactions of used commercial and passenger vehicles take place through the platform.

The company charges 3-4% from sellers while 1% is charged from buyers. In volume terms, 60% of the vehicles sold through Automall are commercial vehicles, while passenger vehicles and agriculture equipments constitute 20% and 10%, respectively.

Most of the outlets of Automall are located on the outskirts, mostly along highways, as it requires large tracts of land to showcase so many commercial vehicles.

“The market for used trucks is around Rs 30,000-Rs 40,000 crore in a given year. Even if there is not much growth in the market, if we can move buyers and sellers from the unorganised market to the organised one, then there can be huge increase in volumes,” said Samir Malhotra, chief executive officer, Shriram Automall.

Within the commercial vehicles sold through Auto Mall, light commercial vehicles constitute 50%, while the rest is medium and heavy commercial vehicles.

In revenue terms, 40% of the company’s volumes come from south India while the same from north and west is around 20% each.

“If the used commercial vehicle market gets organised then small-time fleet owners will get authorised products
at competitive prices,” said Puneet Malhotra, associate director, IHS Automotive.

Companies like Tata Motors and Eicher Motors have started their used commercial vehicle business a few years back and this will also help this market to evolve like the pre-owned passenger vehicle market.