Used car market size crosses 5 million units

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The demand for pre-owned cars is increasing rapidly in India. Currently 1.25 used cars are being sold for every one new car sold. That is, the market for second hand cars is 25 percent more than that of new cars. The ratio is increasing annually. Also, the used vehicle industry is moving from the unorganized sector to the organized sector. Factors such as the availability of certified cars at reasonable prices, easy financing and long waiting periods to buy new cars have increased consumer interest in pre-owned cars, especially after the COVID pandemic.

Currently, the used car market size in the country has crossed 5 million units annually, while the new car market size is around 4 million units. Sales of new cars in the calendar year 2022 stood at 38 lakh units. According to Gajendra Jangid, co-founder of Cars24, considering the increasing income of people, there is a demand for SUVs along with passenger cars. The trend of demand for SUVs that started five years ago has now reached the older market. 90 per cent of the people in this market are first time car buyers. In the new car market, this ratio can go up to 50 per cent. The sale of luxury cars is estimated to be around five per cent in the used car market. The highest market has been 4 lakh to 12 lakh rupees.