‘From 10-12 years, ownership cycles have halved to 5-6’
According to a report by Motor Intelligence, the Indian used car market is expected to reach $31.62 billion in 2024 and grow at a CAGR of 15.1% to reach $63.8 billion by 2029. A key reason pushing growth is the entry of a clutch of digital-first platforms. Cars24 currently leads the pack, followed by Spinny, CarDekho, CarTrade, OLX and Droom. In this interview, Vikram Chopra, CEO, CARS24, talks to Alokananda Chakraborty about consumer concerns in the category and how digital platforms are looking to resolve them. Edited excerpts:
Your Diwali communication talks about the hidden risks for pre-owned car buyers. What are some of these risks and how will CarTruth mitigate them?
There is a lot of guesswork that often surrounds buying a pre-owned car. Buyers often expose themselves to hidden risks. These include tampered odometers, undisclosed accident histories, faulty electrical systems, and even structural damage that casual inspections can miss. CarTruth is an approach to purchasing that blends confidence with clarity. CarTruth’s Pre-Delivery Inspection (PDI) goes beyond the standard checklist, covering 140 vital aspects of every vehicle. We’re hoping to set a new standard for transparency in the pre-owned car market as it helps buyers make informed decisions and negotiate better deals.
India’s pre-owned car market, as per the Indian Blue Book report, is expected to expand to 10.9 mn units valued at $73 billion by FY28. Give us the top three reasons driving this growth.
The expansion is primarily driven by three key factors — rising urbanisation and middle-class growth, shorter ownership cycles and feature-packed aspirational cars. As India’s urban population expands, so does the demand for affordable personal mobility. A growing middle class, with rising aspirations, seeks value-for-money options, making pre-owned cars the ideal choice.
Younger buyers, particularly millennials, are opting to upgrade their cars more frequently, shortening ownership cycles from the traditional 10-12 years to just 5-6 years. This leads to a higher supply of relatively newer and well-maintained cars in the market.
Finally, the surge in demand for feature-rich SUVs has extended to the pre-owned segment. Buyers are increasingly looking for premium features at more affordable prices, driving the market for high-quality, pre-owned vehicles.
Budget car buyers are the biggest chunk of consumers currently. What will it take to attract more and more premium car buyers?
While budget buyers represent a significant portion of the pre-owned car market, we’re seeing a shift. The average selling price (ASP) of cars is steadily increasing as more consumers are willing to spend on premium vehicles. People are looking for aspirational, feature-packed cars, and we’ve seen growing demand for SUVs and luxury models in the used car market. This trend signals a changing dynamic where even budget-conscious buyers are now exploring more premium options, driven by rising disposable incomes and changing consumer preferences.
Competition in the category has grown tremendously over the years. How has the increasing involvement of organised players impacted the category?
The increasing involvement of organised players in the pre-owned car market has significantly benefited consumers. With companies like ours bringing transparency, reliability, and standardisation to the process, customers no longer face the uncertainty and risks associated with informal transactions. Organised players offer warranties, quality checks, and financing options that provide a seamless and secure buying experience. This shift has raised the overall standards in the market, making it more trustworthy and accessible to a broader audience.
What is the scope for differentiation in the used car market? What are the innovations a player can use after a sale to ensure consumer loyalty?
We recognise that customer loyalty isn’t just built at the point of sale; it’s fostered through a holistic, end-to-end ownership experience. The evolving relationship with customers is providing a platform to used-car market players to expand offerings and introduce multiple services that make car ownership an experience. Brands are developing robust digital infrastructure that makes purchasing used cars easier and ensures safety.
We recognise the need for comfort that customers want to experience and thus are building an umbrella of services. With Orbit, customers have one-tap access to essential tools — secure document storage through the Cosmic Vault, real-time notifications for renewals, and e-challan payments — all designed for hassle-free management. CarPrice.ai adds value by providing real-time car valuation, helping customers stay informed of their vehicle’s worth and depreciation trends. Our Fourdoor multi-brand service simplifies maintenance and repairs, while Autopilot delivers a driver on demand, ensuring customers can enjoy their car without always needing to drive. By offering these services, we aim to be a trusted partner throughout our customers’ ownership journey, fostering long-term loyalty and setting a new standard for post-sale support in the used car market.
Supply is perhaps a bigger challenge than demand in your industry. Why is it like that? What will it take to move the needle?
The supply issue in the pre-owned car market stems largely from the sector’s unorganised nature and the information asymmetry that exists between sellers and buyers. Unlike demand, which is strong, the availability of quality, well-maintained cars is still a challenge. This is where we can help move the needle — by streamlining the process, offering transparency through tools and encouraging more sellers to trust organised platforms, we can address the supply gap. We aim to simplify the selling process and build a more robust inventory, ensuring both quality and quantity for buyers.