India’s used car market is experiencing significant changes. The reasons are several. Some of these factors COVID-19 pandemic impact on individual mobility preferences increased financing options for used cars and of course reduced cash flow for new car purchases. Apart from all these, new norms regarding the scrapping of cars is playing a crucial role.
Such shifts have resulted with increased availability as well as demand for used cars. Buyers are seeking alternatives to purchasing new vehicles. The market is now poised for substantial growth and particularly with the new emission standards and focus on reducing the production of diesel cars.
Motor Intelligence report reveals the used car market in India is expected to reach $31.62 billion this year. The projected compound annual growth rate (CAGR) is expected to be 15.10%. Hence, the figure may reach $63.87 billion by 2029.
Cars24 of one of the key players in the market and its earning is exceeding Rs 5,500 crore. Spinny secured the second position in 2023 with about 30-fold growth in revenue (GMV). Other significant players include CarDekho, CarTrade, OLX, and Droom.
Four unicorns have been born in the sector and these are Cars24, Spinny, CarDekho and Droom. Cars24 is leading. Its valuation is $3.3 billion.
It is interesting to know here that all these companies received their last funding in 2021. However, OLX has not raised funds for a significant period.
Cars24, Spinny, CarDekho and CarTrade witnessed various degrees of revenue growth and operational performance. Cars24’s revenue slightly declined while Spinny’s scale (GMV) was up significantly. CarDekho experienced growth and CarTrade recorded sales growth. OLX and Droom reported revenue for the fiscal year.
Wrapping up here, it is important to understand that user behavior towards used cars has evolved. They have started accepting pre-owned cares with increasing trust. Moreover, a growing interest in electric vehicles is also shaping the future of the used car market in the country.
