GM to launch used car business in India this month

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Mumbai: General Motors India will be launching its used car business this month. To be called ‘Chevrolet Ok’, the used car business will be floated in a phased manner by the company.

“It is a pilot project and we plan to start with 10 dealers. Then, depending upon the popularity, it will be taken to other dealers,” Karl Slym, president and managing director, General Motors India told FE on the sidelines of the UTVi Autocar Awards 2009 in Mumbai. By the end of 2008, the company had 188 sales points and 190 service outlets.

Companies including Tata Motors, Audi India, BMW India and Porsche India are planning to enter the used car business in India soon. Other car companies already into the used car business in the country include Maruti Suzuki, Toyota, Hyundai and Mahindra & Mahindra (M&M). The market for used cars is similar to that of new cars. In 2007-08, total new passenger car sales in India was 1.5 million, while used car sales was 1.4 million.

“You can bring any brand car to the dealer and drive away either a new or a used Chevrolet car,” explained Slym.

Currently, there are close to three lakh Chevrolet cars in the country that are over five years old. GM India produces Chevrolet Captiva, Chevrolet Optra, Chevrolet Aveo, Chevrolet SR-V, Chevrolet Aveo U-VA, Chevrolet Spark and Chevrolet Tavera for sale in India.

“The used Chevrolets will be certified by the company and bear a warranty of six months and 15,000 kilometres,” said Ankush Arora, vice president, marketing, sales and after-sales, General Motors India.

However, the used car market that depends upon the new car market is projected to see a dip of 25% this financial year. This is because there are fewer new buys leading to low exchange and also because the incentives floated by auto companies and government on cars are leading to lessening the demand for used cars, explains Mohit Dubey, CEO, CarWale.com. He added that the used car market is still more or less unorganised in the country and such initiatives by the auto companies will bring in more certified used cars in the market. In 2007-08, 1.4 million used cars were sold.