India Pre-Owned Car Market Report Analysis

As per a report on ‘India Pre-owned Car Market Report’ by Indian Blue Book, 25-34 year olds form 50% of the used car buyers. In its first edition, it also analyzes the Indian market relative to two other important markets – the United States and China. These relative country assessments are first of their kind globally.

Following are the key-highlights:

• India is expected to be amongst the top 5 automotive markets in the world by 2020.
• At 3.3 million units, the pre-owned car market is growing at over 15% a year (organized segment is growing at over 25% a year)
• Just under half (45%) of all pre-owned cars sold are in Metros. Non-metros account for over half (55%) the pre-owned car volume sold and are growing faster than the metros.
• The North leads the pre-owned car market in India. At 36% it represents the largest geography, followed by the West (27%), South (26%) and East (11%).
• The North and West regions exhibit more organized channels than in the South. The East, while more organized, is a significantly smaller market and also highly concentrated in a few areas.

Structure: Largely unorganized retail & wholesale

• The market is supply-constrained, with inventory turns at dealers under 30 days vs. traditionally 60+ days in the U.S.
• Pre-owned car channels are highly fragmented with four primary market segments:
  • Organized: 12% market share, Average Volume at 16 per month
  • Semi-organized: 35% market share. Average Volume at 9 per month
  • Consumer to Consumer: 34% market share
  • Unorganized: 19% market share. Average Volume at <3 per month
• The unorganized sector is highly fragmented. It accounts for the bulk of the dealer population (58%) and only 19% of the total volume.
• There are no formal wholesale channels for dealers to procure pre-owned cars.