Global Used Car Market Research Report, 2024-29

A vehicle driven previously but still in working condition for resale is referred to as a used car. Used automobiles are sold through a variety of venues, including franchise and independent car dealers, rental car companies, auctions, private party sales, and leasing offices. Because of the high cost of auto ownership and maintenance, the average number of cars purchased by millennial has declined. Furthermore, millennial are more inclined to prefer used vehicles over new ones while traveling in order to save money. Furthermore, the high cost of new cars precludes many individuals from purchasing them, increasing demand for older vehicles. This paves the way for diverse investments by industry participants to establish dealership networks in the market. The market for used automobiles is predicted to grow as a result of factors such as the high cost of new cars, concerns about affordability, and rising demand for off-lease cars and subscription services from franchises, leasing offices, and car dealers. The majority of customers want more affordable modes of transportation that are safe and sensible to purchase (both ergonomically and economically). This increases the demand for entry-level used compact car segments. Individuals would prefer secondhand cars over new cars in an economy with uncertain employment and unpredictable income flows. The global expansion of internet sales channels has also influenced the overall consumption of used cars. Despite accounting for a modest portion of overall used car sales, online automobile shopping has enormous development potential. Furthermore, car dealers use their websites as a sales and marketing generation channel to direct purchasers to the showroom floor, where they complete the purchase. Consumers are now looking for e-commerce solutions for their complete transaction. Furthermore, the number of digital vendors, such as Vroom, Carvana Inc., eBay Motors, and Shift Technologies Inc., that expressly cater to online vehicle customers is increasing, increasing market competitiveness. According to the research report, “Global Used Car Market Overview, 2023-28” published by Actual Market Research, the market is anticipated to cross USD 2 Trillion by 2029, increasing from USD 1.84 Trillion in 2023. The market is expected to grow with 6.11% CAGR by 2024-29. Rising technical breakthroughs, such as the market's adoption of digital technology and the usage of artificial intelligence to improve the online purchasing experience, are likely to drive market demand throughout the forecast period. Other variables influencing the used automobile industry include transparency between the seller and buyer and certified used vehicle programs. Furthermore, one of the most apparent trends in recent years has been the increased use of older electric and hybrid vehicles. The rising number of new Electric Vehicles (EVs) and hybrid automobiles registered in recent years is now entering the market. For example, European countries like as Germany, the United Kingdom, Spain, and Austria have seen large volume sales of gasoline, electric vehicles, and hybrid automobiles. Some significant reasons propelling the used automobile market are the transparency and symmetry of information among consumers and purchasers, the rise of the online sales channel, certified used vehicle programs, and the strong position of franchise dealers. Leading organizations have established online and offline storefronts throughout the world to provide smooth used automobile purchasing experiences. For example, AutoNation Inc. will expand its pre-owned vehicle dealership and build two more locations in the Denver region in the United States in September 2020. The firm has stated that it intends to open 130 AutoNation Inc. outlets across the United States by 2026. The used automobile market is predicted to rise significantly as a result of increased digitization and companies' ability to provide engaging purchase experiences remotely. Furthermore, the increase in value-added service offerings and the variety of finance providers offering credit for used automobiles will contribute to the global expansion of the used car market. Higher interest rates, on the other hand, may deter some potential buyers, reducing market growth. Market Drivers

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• Changing Consumer Attitudes: Shifting consumer attitudes toward car ownership also drive the used car industry. With an increasing focus on shared mobility services, such as ride-hailing and car-sharing, some consumers prefer to buy used cars for personal use instead of committing to long-term new car ownership. This change in mindset contributes to the overall demand for used vehicles. • Supply Chain Disruptions: Supply chain disruptions affecting the production of new cars can indirectly drive the used car market. When there are delays in the production of new models due to factors like global events, natural disasters, or component shortages, consumers may turn to the used car market for immediate vehicle needs, bolstering demand for pre-owned vehicles. Market Challenges

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• Financing and Credit Accessibility: Securing financing for used cars can be a challenge for some consumers, especially if they have limited credit history or face higher interest rates. Improving access to affordable financing options for used cars is crucial for broadening the market and making pre-owned vehicles more accessible to a diverse range of buyers. • Evolving Automotive Technologies: While technological advancements are a driver, they also present challenges. The rapid evolution of automotive technologies can result in older used cars lacking the latest safety features and connectivity options, potentially affecting their market appeal. Striking a balance between offering modern features and maintaining affordability is a challenge for the used car industry. Market Trends

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• Subscription Services and Leasing: The emergence of subscription services and leasing options for used cars is a growing trend. This model allows consumers to enjoy the benefits of car ownership without the long-term commitment. Subscribers can access a variety of vehicles, and at the end of the subscription period, they can choose to continue with the current vehicle or switch to a different one. • Data-Driven Decision-Making: The use of data analytics is becoming increasingly prevalent in the used car industry. Dealers and online platforms leverage data to gain insights into market trends, pricing strategies, and customer preferences. This trend facilitates more informed decision-making, helping industry players adapt to changing market dynamics. Covid-19 Impacts The pandemic disrupted global supply chains, leading to shortages of new cars. This scarcity of new vehicles, coupled with production delays, has increased demand for used cars as consumers look for alternative transportation options. The imbalance between supply and demand has, in some cases, driven up prices in the used car market. The economic fallout of the pandemic has led to financial uncertainty for many individuals. As a result, consumers are reevaluating their spending habits and seeking cost-effective options. Used cars, known for their lower prices compared to new ones, have become a more attractive choice for budget-conscious buyers. The overall uncertainty caused by the pandemic has led to market volatility. Fluctuations in consumer demand, economic conditions, and supply chain disruptions have created challenges for dealerships and sellers in predicting and adapting to market conditions. Some consumers, facing financial constraints during the pandemic, may delay maintenance on their existing vehicles or postpone plans to upgrade to a new one. This behavior has influenced the availability of used cars in the market, impacting both sellers and buyers. In various regions, government stimulus packages and incentives to boost economic recovery have included measures related to the automotive industry. Some countries have introduced programs encouraging the purchase of new or used vehicles, offering tax credits or financial assistance. These initiatives aim to stimulate the automotive sector amid economic challenges. Lockdowns and social distancing measures have accelerated the adoption of online platforms for buying and selling used cars. Digital marketplaces and virtual showrooms have become essential tools for dealerships, enabling them to reach customers in a contactless manner. This shift toward online transactions is likely to persist even beyond the pandemic. The growth of electric vehicles in the used car market is primarily driven by increasing consumer awareness, advancements in technology, and a desire for sustainable transportation options. The surge in popularity of electric vehicles (EVs) within the used car market can be attributed to a combination of factors, with heightened consumer awareness playing a pivotal role. As people become more informed about environmental issues and the need for sustainable living, there is a growing interest in electric vehicles as an eco-friendly alternative to traditional combustion engine cars. Advancements in electric vehicle technology, including improvements in battery life and charging infrastructure, have alleviated concerns about the practicality of EVs and increased their appeal among consumers. Additionally, as the adoption of electric vehicles continues to rise in the new car market, a subsequent influx of used electric cars becomes available, offering a more affordable entry point for budget-conscious buyers. Government incentives and rebates in various regions have also played a crucial role in making electric vehicles more accessible, both in terms of purchase price and ongoing operational costs. The growing acceptance of electric cars in mainstream automotive culture has further fueled their presence in the used car market, with consumers recognizing the long-term benefits of reduced maintenance costs, lower environmental impact, and the overall sustainability associated with electric transportation. As these factors converge, the electric vehicle segment is likely to witness continued growth within the used car market, contributing to a more sustainable and environmentally conscious automotive landscape. The growth of SUVs and MUVs in the used car market is driven by shifting consumer preferences towards vehicles that offer versatility, spacious interiors, and a commanding driving experience. The increasing popularity of SUVs (Sports Utility Vehicles) and MUVs (Multi Utility Vehicles) in the used car market can be attributed to evolving consumer preferences and the versatile nature of these vehicles. Consumers are increasingly drawn to the practicality and versatility offered by SUVs and MUVs, as these vehicles provide spacious interiors, elevated driving positions, and a robust image. In the used car market, buyers are often seeking vehicles that cater to a variety of needs, from family transportation to off-road capabilities, and SUVs/MUVs fit these requirements well. The robust design and higher ground clearance associated with SUVs are particularly appealing to consumers, providing a sense of safety and a more commanding view of the road. Additionally, the spacious interiors make these vehicles suitable for families, adventure enthusiasts, and those looking for a comfortable driving experience. The growing popularity of SUVs and MUVs in the new car market has translated into increased availability in the used car segment, offering buyers a diverse range of options. Moreover, the durability and ruggedness of these vehicles make them attractive choices in the used car market, where buyers often seek reliable and long-lasting options. As a result, the demand for used SUVs and MUVs is on the rise, reflecting a broader shift in consumer preferences towards vehicles that combine practicality, versatility, and a strong aesthetic appeal. The growth of alternative fuel vehicles (CNG, LPG, electric, etc.) in the used car market is fueled by increasing environmental consciousness, rising fuel prices, and government incentives promoting eco-friendly transportation choices. The surge in popularity of alternative fuel vehicles, including Compressed Natural Gas (CNG), Liquefied Petroleum Gas (LPG), and electric cars, within the used car market is driven by a confluence of factors. Primarily, there is a growing awareness and concern for environmental sustainability, prompting consumers to seek greener transportation options. CNG and LPG vehicles, known as cleaner-burning fuels, are perceived as environmentally friendly alternatives to traditional gasoline or diesel-powered cars. Additionally, the rising costs of conventional fuel have led buyers to explore more cost-effective and efficient options, further propelling the demand for vehicles running on alternative fuels. Electric cars, in particular, have gained traction due to advancements in battery technology, resulting in increased driving ranges and improved charging infrastructure. Moreover, government incentives and subsidies aimed at promoting the adoption of eco-friendly vehicles have played a significant role in encouraging consumers to consider alternative fuel options in both new and used car markets. As a result, buyers in the used car segment are increasingly drawn to vehicles that offer fuel efficiency, reduced environmental impact, and potential cost savings in the long run. The growth of alternative fuel vehicles in the used car market reflects a broader shift towards sustainable and economically viable transportation choices, contributing to a more environmentally conscious automotive landscape. The growth of SUVs by size in the used car market is attributed to the diverse preferences of consumers seeking a wide range of options, including compact, midsize, and full-size SUVs, each catering to specific lifestyle needs and preferences. The expansion of SUVs by size in the used car market is a result of the automotive industry responding to the diverse demands of consumers. Consumers have varying preferences and requirements when it comes to their vehicles, and the SUV category provides a spectrum of options to cater to different needs. Compact SUVs are favored for their maneuverability, fuel efficiency, and urban-friendly size, making them suitable for individuals or small families seeking a versatile and economical choice. Midsize SUVs offer a balanced combination of space, performance, and comfort, making them popular among families and individuals who prioritize a more spacious interior without compromising on agility. Full-size SUVs, on the other hand, appeal to those with larger families or a need for substantial cargo space and towing capacity. The versatility of SUVs by size ensures that there is a suitable option for various lifestyles and preferences, and this diversity is reflected in the used car market as consumers seek reliable, well-maintained options across different size categories. Additionally, the perception of SUVs as vehicles that provide a sense of safety, elevated driving positions, and a robust appearance contributes to their popularity in the used car market, where buyers often prioritize these features in their vehicle choices. Overall, the growth of SUVs by size in the used car market is indicative of the industry's ability to meet the nuanced demands of a broad consumer base seeking vehicles that align with their individual needs and preferences. The growth of organized vendor types in the used car market is driven by increasing consumer trust, transparency, and the adoption of standardized processes offered by established dealerships and online platforms. The organized vendor segment's expansion in the used car market is a response to the changing dynamics of consumer behavior and preferences. Consumers are increasingly prioritizing trust, transparency, and reliability when it comes to purchasing used cars, and organized vendors, including established dealerships and online platforms, are well-positioned to meet these expectations. Unlike informal or individual sellers, organized vendors adhere to standardized processes for vehicle inspection, refurbishment, and documentation, instilling a sense of confidence in buyers regarding the quality and history of the used cars they are considering. These vendors often offer certified pre-owned programs, providing additional assurances on the condition of the vehicles. The presence of reputable dealerships and online platforms also contributes to greater transparency in pricing and information, as they are more likely to provide comprehensive details about a vehicle's history, maintenance records, and any potential issues. Furthermore, organized vendors often offer financing options, warranty packages, and after-sales services, enhancing the overall customer experience. The professional approach of organized vendors, along with the convenience of online transactions, appeals to modern consumers seeking a hassle-free and trustworthy buying process. As a result, the growth of organized vendor types in the used car market is reflective of the industry's response to evolving consumer expectations, emphasizing integrity, reliability, and a seamless buying experience. The growth of online distribution channels in the used car market is fueled by the convenience, transparency, and extensive choices offered to consumers, enabling them to browse, compare, and purchase vehicles from the comfort of their homes. The surge in popularity of online distribution channels within the used car market is a testament to the transformative impact of digital platforms on the automotive industry. Consumers today prioritize convenience and efficiency, and online channels cater to these preferences by providing a seamless and accessible vehicle shopping experience. Online platforms offer a wide range of used cars, allowing buyers to browse through extensive inventories, compare prices, and access detailed information about each vehicle, including its history, specifications, and condition. This level of transparency is crucial in building consumer trust, a factor that has traditionally been a challenge in the used car market. Additionally, the convenience of online transactions enables buyers to complete the entire purchasing process, from research to financing, without the need to visit physical dealerships. The rise of digital marketplaces also allows for a more competitive market, with various sellers competing on a single platform, leading to potentially better pricing for consumers. Virtual showrooms, 360-degree views, and online customer reviews further enhance the buying experience, providing valuable insights for prospective buyers. The shift towards online distribution channels in the used car market is a response to the evolving expectations of modern consumers who seek a more streamlined, transparent, and accessible approach to purchasing vehicles, ultimately reshaping the dynamics of the automotive retail landscape. The Asia-Pacific used car market is growing due to increasing consumer demand driven by rising income levels, urbanization, and a growing awareness of the benefits of purchasing used cars. The growth of the used car market in the Asia-Pacific region can be attributed to several interconnected factors. Firstly, the rising income levels in many countries within the region have led to an expanding middle class with greater purchasing power. As a result, more consumers are now able to consider buying used cars as a cost-effective alternative to new ones. Urbanization is another crucial factor, with a growing number of people migrating to cities, creating a demand for affordable and reliable transportation. Additionally, as consumers become more informed about the advantages of purchasing used cars, such as lower depreciation rates and a wider range of options, there is a shift in perception towards pre-owned vehicles. This changing mindset is further fueled by an increased emphasis on sustainability, where reusing and recycling cars align with environmental consciousness. The combination of these factors has created a conducive environment for the growth of the used car market in the Asia-Pacific region, with dealerships and online platforms capitalizing on the burgeoning demand by offering diverse options and competitive pricing. As this trend continues, the used car market is likely to play a significant role in the automotive industry's evolution in the Asia-Pacific region. Key players in the market are focusing on strengthening their online presence by engaging in partnerships with online marketplaces or developing their own e-commerce platforms. This allows them to reach a broader consumer base and offer more transparent and convenient buying experiences. In line with this, manufacturers are organizing certified pre-owned (CPO) programs, which involve inspecting, refurbishing, and certifying used cars to meet specific quality standards. Moreover, these programs enhance trust among buyers in used cars. Apart from this, companies are incorporating advanced technologies, such as artificial intelligence (AI) and data analytics to improve inventory management, pricing strategies, and engagement of individuals. • By early 2024, Volvo intends to have a third of its volume come from its certified used-car sector, which it will start in September 2022 and spread throughout the country. Volvo uses the 'Selekt' platform, which it just introduced in India with two dealerships, to run its {{keyword}} business worldwide. • In May 2023, CarMax, the omnichannel used-car retailer, announced amplifying its customer outreach initiatives and elevating the overall customer experience by integrating the language models and Azure OpenAI that power ChatGPT. • In June 2023, Jardine Cycle & Carriage Limited, the investment arm of Hong Kong-based Jardine Matheson collaborated with Southeast Asian car marketplace Carro. According to a joint statement by the companies, this collaboration will provide Carro with access to a broader selection of high-quality used cars while enabling Carro to improve Republic Auto's digital services and offerings. The alliance aims to strengthen both companies' positions in the market and enhance their customer experiences. Considered in this report • Historic year: 2018 • Base year: 2023 • Estimated year: 2024 • Forecast year: 2029 Aspects covered in this report • Used Car market Outlook with its value and forecast along with its segments • Various drivers and challenges • On-going trends and developments • Top profiled companies • Strategic recommendation By Vehicle Type • Conventional • Hybrid • Electric By Body type • Hatchbacks • Sedan • SUV & MUV • Others By Fuel Type • Petrol • Diesel • Others By Size • Mid-Size • Compact • SUVs By Vendor Type • Organized • Unorganized By Distribution Channel • Offline • Online By Offline Distribution Channel • Independent Dealer • Franchise Dealer • Private Sellers • Others (Used Car Auctions, Certified Pre-Owned (CPO) Programs, Consignment Dealerships, etc) The approach of the report: This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources. Intended audience This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Used Car industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.