The used car market in India is growing at a phenomenal pace and due to shorter car ownership periods, price value quotient, penetration in smaller towns, demand for used luxury cars, and reduced customer anxiety towards pre-owned car segment, it is turning out to be bigger than the new car market
As per the data by SIAM released in 2018, at nearly four million used cars, the market is 1.25 times bigger than the new car market that saw sales of 3.2 million units last financial year.
Also, CRISIL in its report stated that almost two in every three cars sold in the country are used cars, projecting that the Indian used car market will continue growing at a steady pace of 15% till 2020.
CARS24 buys all kinds of cars, be it premium or lower end, from tier 2-3 and even if the car has a loan against it. The company aims at tapping the market to its optimum and capture 10% market share of the pre-owned car market by 2022
Currently, selling a car is a time consuming and laborious process as it takes several weeks of interacting with strangers, allowing test rides and haggling for price. The ordeal doesn’t end here, getting the RC transferred and ensuring that you are getting paid in full can take additional months.
CARS24 has changed this forever. Now, the owner can sell the car in less than two hours by just driving down to the nearest CARS24 branch. CARS24 transfers the payment instantly into the seller’s bank account and also takes complete responsibility of all the paperwork, including RC transfer. In parallel, the company uses technology to sell these cars to their partners all across India.
This has made CARS24’s business a unique C2B model, focused on ‘supply first’, and in principal a very different approach to winning the used car market, as compared to the C2C and B2C business models that exist in the used car industry today.
Meanwhile, CARS24 is helping dealers grow their business, assisting them with financing and organise a fragmented market. They are connecting supply to demand by organising the supply side of things.
Within three years of commencing operations, CARS24 has bought over 100,000 cars across its branches till 2018. It has grown rapidly to become a leading player in the Indian used car sector. Over 10,000 trusted business partners from more than 100 cities across India are already participating in the proprietary online auctions. By the end of 2018, car owners will be able to sell their cars across 110 CARS24 branches in 20 cities. Based on its extraordinary growth trajectory, CARS24 targets a run rate of over one million transactions by 2020 with 1000 branches in 100 cities.
“We have been around three years now. We are building India’s largest auto company that can be bigger than OEMs in India. India is set to become world’s third largest auto market just behind US and China and in terms of value, it’s today a $30 billion market going to be $100 billion in next decade. In terms of units sold, it is today four million units sold per year in used cars, going up to 14-15 million units in a decade’s time. The reason behind this growth is in India, the per capita ownership of cars in India is extremely low, it’s like 50 cars per 1000 people, compare this to developed economies, it’s always over 500 cars per 1000 people. There is a huge headroom of growth of used cars in India,” said co-founder and CEO, Vikram Chopra, CARS24.
CARS24 is removing the supply bottlenecks and leveraging technology to streamline the operations in the used car market.