[Rahul Bhalgat]

Originally Posted by Rajeevraj

Came across this nice article by Management Punditz on the Used Car Industry in India. Some good charts and numbers.

Indian Used Car Industry

Key extracts:

• Considering the huge amount of launches in the last few 4-5 years upgrade cycles shrinking, the used car market as mentioned above is definitely going to explode.
  
• Many people still have a block against buying used, but as the sector continues to evolve into a more matured reliable model, customer confidence in buying used is going to increase.

Very interesting information Rajeevraj.

I have a query:
If the upgrade cycles shrink, the prospective buyer may find that the model that he intends to purchase has been discontinued from the production. Will this affect the used car sales? Will the used car market prefer the cars having long life-cycle and huge population?

You are bang on the point about the mental block against buying a used car. Some innovative entrepreneur (backed by venture capital, if necessary) can change this mental block. Mass brain wash is the main challenge IMO.

[Rajeevraj]

Originally Posted by Rahul Bhalgat

Very interesting information Rajeevraj.

I have a query:
If the upgrade cycles shrink, the prospective buyer may find that the model that he intends to purchase has been discontinued from the production. Will this affect the used car sales? Will the used car market prefer the cars having long life-cycle and huge population?

I meant the people upgrading cars more frequently and not the manufacturer upgrade cycle.

Most models in our market-Especially the popular ones have a long life span. And even post discontinuation, the service and spares support will be there for 7 years. Today I think the used car market prefers the safe and popular cars, but I personally think that will change over the next few years.

Even today there is lot of demand for niche, mod friendly, performance oriented discontinued cars like the Zen, Fiesta 1.6, Baleno etc.

[GTO]

Used car sales are apparently hit bigtime by GST. In Ahmedabad for instance, Economic Times says that volumes are down 30%

“Pre-owned car sales volume has declined by 30% compared to Navratri last year,” said Jainish Prajapati, an official at a car dealership in the city.

Market estimates suggest an average of 5,500-6,000 used cars were sold every month in Ahmedabad and that number has come down to 3,500 to 4,000 units this month.

According to dealers, higher GST rates have adversely affected sales. Under the new tax regime, pre-owned cars attract 28% GST plus cess, which has narrowed buyers’ budgets.

Under GST, a customer has to pay 28% GST and additional cess depending upon engine capacity. Before GST, a customer had to pay 1% VAT till a maximum up to Rs 2,000 for used cars.

[Turbanator]

Used car sales are apparently hit bigtime by GST. In Ahmedabad for instance,

But this is contradictory to discussions on the other thread

http://www.team-bhp.com/forum/indian...ml#post4267491

I don't think they can apply GST on used cars if they are not giving Inputs to businesses on GST. Linking this with depreciation won't be correct and there can be litigation.

I believe reasons of low sales of used cars can be lack of liquidity, a lot of cash has gone to banks and people who have now funds in bank realise the value of this and won't like to splurge this tax paid/ saved money on Cars. Previously it was mostly cash driven, 20-30 % cheque and balance cash. Also on old cars beyond 10 Lac, 1 % TCS needs to be deducted which also most guys wants to avoid.

[pgsagar]

Originally Posted by GTO

Used car sales are apparently hit bigtime by GST. In Ahmedabad for instance, Economic Times says that volumes are down 30%

I think GST on used cars applies to used car dealers and not individuals selling their own personal cars. Because, GST applies on goods or services supplied ...in the course of furtherance of one's business. If I sell my personal car, it is not furtherance of my business as selling cars is not my business. But a used car dealer is a dealer, a business entity and hence, he would be probably liable to pay tax. So, this move would finish used car dealers and people would buy directly from car owners. Correct me if I'm wrong.

[Sheel]

Only Toyota appears to not be affected by this. Innova and Fortuner continue to rule the roost. Innova's being good at 8-10L and Fortuner [done under 50,000 kms] at over 20L.

Silver lining for owners but bad for pre-worshippers

[volkman10]

India’s used car market races past 4 million units in FY2019, may cross 7m by FY2022.

That translates to 1.2X the size of the new car market. A key growth driver has been the downward revision of GST rate on used cars from 28 percent to 12-18 percent.

As the auto industry enters the BS VI era from April 2020, the value proposition of the used car can grow stronger as new cars become pricier due to additional technology costs. Another development of Maruti Suzuki's decision to exit the diesel car segment by April 2020 could also enhance the demand for compact diesel cars in the used car market unless there is a backlash against diesel

Link

[tarik.arora]

Originally Posted by volkman10

India’s used car market races past 4 million units in FY2019, may cross 7m by FY2022.


Link

I think the used car market has always been 1.2-1.25x the new car market. Now with new car costs shooting through the roof, used market is bound to grow. Especially first time buyers may find used car market attractive.

[volkman10]

Used Vehicles for the Year 2020: Analysis shows an interesting trends with regard to this industry.

1.Top 10 cities which have the highest volumes of used car / bike volumes:



2. Average ownership duration :



3. Top selling cars in this industry - Maruti Suzuki and Toyota dominates



4.Top 5 OEMs of the Used car space : top slots by market leaders

- The market demand for Toyota and Honda throws the rest out of track and the podium as well.



5. The colour game:

- White rules the hearts in the new and used car space.

- The second position was taken by silver here as well.

- Grey, Black, and Red have single-digit contributions in this part of the industry



6. By Fuel Type:

- Unlike new cars, this used car industry shoes preference for diesel



7: Transmission Type:

- Manual is the most preferred



Link

[volkman10]

Best selling cars in the used car market:

- In the hatchback segment, have Swift, Wagon r, and Baleno.

- THE compact UV Segment sees more demand for Brezza. And the UV segment sees more demand for Creta.

- Honda City has been a long-time favorite in the used car industry.

- And Innova as a MPV has always garnered a lot of interest amongst buyers.

- Dzire continues to rule the market with its demand in the hath back segment




Luxury segment:

- From the Mercedes family, he E class, C class, and the ever-in-demand GLC and GLE.

- From Audi, the A6, Q3, and A4.

- The Fiat brand's Jeep Compass has made it to the list since it has spent over 4 years as a new car and attracts good demand in the used car space.



Link