India’s youth are driving record sales for the automobile industry, not just in the new car segment but also in the pre-owned car segment. The demand for new-age features, even in pre-owned cars, is a phenomenon that has become more stark post-Covid pandemic.
Maruti Suzuki, India’s largest carmaker, and Hyundai, country’s second largest, are seeing more-than-expected demand for pre-owned cars and most of it is coming from first-time young buyers, who prefer sport utility vehicles (SUVs) over others.
This trend is not just limited to pre-owned car sales but also in new cars, where a quarter of sales come from youngsters under the age of 30 – about 5 percentage points increase over the past about three years.
Maruti Suzuki, Hyundai Motors and Tata Motors, which cumulatively constitute about 70 per cent of the total PV sales in the country, are all seeing a healthy response from buyers below the age of 30. For Maruti and Hyundai, youngsters’ contribution to the overall sales is about 23 per cent each – lower than the industry’s average — while for Tata Motors, nearly 30 per cent of sales come from people under 30 years of age.
Companies say that the growing preference for personal mobility has gained traction post Covid. “Post pandemic and with the growing preference of personal mobility, we have witnessed a 33 per cent growth YoY as far as True Value (brand name for Maruti’s pre-owned car stores) is concerned. Nearly 50 per cent of our pre-owned car buyers fall in the 18-35 years age bracket, followed by nearly 45 per cent of the POC buyers falling in the age group of 36-60 years and the rest ageing 65+ years,” Shashank Srivastava, Senior Executive Officer, Marketing & Sales, MSIL, was quoted in an email response.
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“About 67 per cent of our POC buyers were first time buyers while the rest of the buyers bought POC as an additional vehicle or replaced their existing vehicle,” the response read.
Hyundai says they have reported a 21 per cent increase in car sales across their stores during the January-November this year as compared to last year.
“H-Promise (brand name for Hyundai’s pre-owned cars sales outlet) counts Gen Z, millennials and boomers amongst our esteemed customers. However, customers in the 31-40 years age-bracket account for the biggest slice of the pie when it comes to pre-owned car sales across our outlets,” the company said in an email response.
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Sales of pre-owned cars too is primarily driven by youngsters, which is an indicator that urban consumers in India are driving this demand. While the demand is high, one can not predict as to how long will this demand last.
Such is the allure of the pre-owned car segment that new companies are also entering the segment. Kia India, which is just three years old in India, has entered the pre-owned car sale space. “With exclusive Kia Certified Pre-Owned outlets, the company intends to provide a new age experience to customers, in line with new car buying experience, that will allow them to sell, buy or exchange pre-owned cars, backed by hassle-free ownership transfers and customised finance options,” Kia had said in a press statement. Currently, Maruti Suzuki, Hyundai Motors and Mahindra are in the pre-owned car sales space. Mahindra did not respond to a query by The Indian Express. The companies have also witnessed a demand for SUVs and new-age features, including automatic gearbox.
“Just like new cars, we are witnessing a rise in demand for SUVs and MPVs in the pre-owned car space too. SUV and MPV segments are also seeing faster replacement cycles, so owners are selling off their SUVs much sooner than some other segments,” Srivastava said.
“The most sought after features our pre-owned customers look for include company fitted AVN (Audio, Video Navigations) systems, automatic climate control, airbags, braking systems like ABS with EBD, automatic gearbox, etc,” Hyundai said.
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In the pre-owned category space, sales of cars running on petrol account for a substantial part of sales for both Maruti and Hyundai.
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December 26, 2022 at 06:00AM
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Just like new: Demand for pre-owned cars matches first-hand auto sales - The Indian Express
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