Owning a pre-owned car today does not compromise dignity. For some people, purchasing a used car is more sensible against splurging on a new car. Instead, the used car industry is booming in India faster than ever and has become a Rs 1 billion club. The used car market is showing double digit growth for the past two-three years and has even beaten new car sales a number of times by big margin. Due to this, many of these manufacturers are now entering the authorized used car retailing to gain back their potential customers. There are several reasons behind this sheer growth of used car industry, here are some:
Constant vehicle upgrading
As competition is rising in the auto sector, many people are inclined towards upgrading their existing vehicle to better and feature rich vehicles. Up until few years back, people would keep their cars upto five years but now this has come down to mere three years. This drift has directly resulted in favor of used car sector where people searching for used cars have now plenty of choices to choose from. This ratio and higher supply is further changing in good turn for the used car industry.
Affordability and pricing
This is another reason of the explosion in the pre-owned car sector. As there are plenty of choices, pricing is bound to allure the newcomers. Now every middle class man can think of owning a four-wheeler car which was way back restricted only to the affluent peoples. Even a city sedan can be purchased under 1 lakh rupees which is no longer a surprise nowadays. The highest demand is seen in the used cars priced between 1-2 lakhs and more than 90 percent of people prefer to buy used car under Rs 5 lakhs.
Trends like purchasing expensive motorcycles is getting slowing as used cars can be bought 'cheap' and can be sold quickly in a few years at a good price. So, the appetite is increasing keeps growing.
Top manufacturers entering business
Almost all the major players have now entered the mainstream used car market, so people can buy certified used car from their trusted brands, which is a big relief for many as the other option was an unscrupulous dealer. Maruti Suzuki, the largest passenger carmaker and the most trusted brand in India could be quoted as the best example of this development.