Tata Motors bets big on used car business

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Used car business next big bet of Tata Motors

Tata Motors is planning to scale up its used car business this year replicating the strategy of Maruti Suzuki and Mahindra & Mahindra’s pre-owned business, but will not have a separate chain for the segment.

The company is running a pilot programme in several locations and is in the process of identifying markets where pre-owned cars are in huge demand.

“Our next big strategy is to take forward the used car business. We will have an upgraded network which will cater to the customers looking to buy pre-owned vehicles,” Mayank Pareek, president of Tata Motors passenger vehicle business told FE. He was speaking on the sidelines of the launch event of its SUV Harrier.

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Tata Motors had in 2009 commenced its certified pre-owned car programme — Tata Motors Assured —, but has not been able to match up to the competition due to gaps in product portfolio and falling demand. New product launches after 2015 such as Nexon, Tiago and Tigor has helped the company revive its market share.

“After the success of our cars, we will not pursue used car segment as a strategy. Earlier it was just available in a small scale,” Pareek said.

Currently, Mahindra & Mahindra (M&M) has the largest network of over 1,700 pre-owned cars outlets under the umbrella of Mahindra First Choice. Maruti Suzuki has the second largest network of 1,200 outlets under the brand name True Value. HyundaiMotor India has a network of around 470 outlets. Tata Motors, which currently has a dealer network of 780 outlets, plans to increase it to 2,000 by 2021.