[GTO]

Maruti sells about 100,000 new cars each month, with Hyundai in second place at ~38,000 cars. In a distant 3rd are Mahindra & Honda who frequently trade places with each other, moving between 15,000 - 20,000 cars / month. Over the last year, Mahindra & Honda have held 3rd place an equal number of times.

It's time for them to move over; we now have a new no.3 in the market. Maruti's True Value has sold more (used) cars than Mahindra or Honda have new. Maruti's used car arm has moved a whopping 3.6 lakh units from April 2014 - March 2015. That's 30,000 cars each month ! With the way that the pre-owned sector is growing - and it is at a faster rate than the new car market - don't be surprised if Maruti True Value overtakes Hyundai in terms of car sales. After all, Maruti's used car division sold 100,000 more cars in FY15 than in FY14.

Maruti has over 800 True Value outlets across India. That's bigger than the Mahindra & Honda networks! Margins in used cars are usually fatter than that of new cars too.

Due to the disorganised nature of the segment, it's hard to keep track of absolute numbers. Yet, most analysts agree that the Indian used car market is moving 3 million cars a year. That gives Maruti True Value a 12% market-share.

Excerpts from Business-Standard

In the first quarter ended June, a total of 87,800 cars landed at True Value, up 12 per cent from last year.

R S Kalsi, executive director (sales and marketing) at Maruti Suzuki, said on an average 30 per cent of new car buyers go for an exchange. These cars go through a valuation process at a True Value outlet and the money is adjusted in the margin money that the buyer has to pay for a new car.

Kalsi said the gap between interest rate for financing a new and used car has also come down from five to six per cent a couple of years ago to about two per cent now.

Mahindra First Choice Wheels, backed by Mahindra & Mahindra, is also a leading player. First Choice, unlike True value, is a multi-brand used car player with a network of 500 outlets and plans to grow to 1,800 outlets by 2020. It sold 140,000 used vehicles in the last financial year

[chaith.turbo]

Originally Posted by GTO

Due to the disorganised nature of the segment, it's hard to keep track of absolute numbers. Yet, most analysts agree that the Indian used car market is moving 3 million cars a year. That gives Maruti True Value a 12% market-share.

Given that Maruti has a 45% market share in new car market, shouldn't they also have a similar percentage in used car market? simply because there will be more Maruti cars in used car market.

I wonder if Toyota's percentage in used car market might be more than new car.

[GTO]

Originally Posted by chaith.turbo

Given that Maruti has a 45% market share in new car market, shouldn't they also have a similar percentage in used car market? simply because there will be more Maruti cars in used car market.

Not necessary that every Maruti will be sold through a True Value outlet. An overwhelming majority of used car sales are from the cluttered & disorganised segment (direct sales, brokers, small used car dealers).

[latentpotential]

Very Very interesting statistic, this week seems to be full of new data points to absorb indeed.

This also means the market for cars India is maturing, with greater acceptance of used cars.

Further, one may infer that True Value must be offering a acceptable price in lieu of an old car, why is why they get so many cars in their system?

[Live To Jive]

Originally Posted by GTO

Not necessary that every Maruti will be sold through a True Value outlet.

Also not every car sold through a True Value outlet is a Maruti. They buy and sell all brands.

[GeeTee TSI]

So True Value can cannibalize (maybe it is) Maruti Suzuki new car sales. Or a joint promo can stimulate both!
Interesting bit of news, especially when OEMs are beset with one offering cannibalizing the other from the same stable

[xingamazon]

Originally Posted by chaith.turbo

Given that Maruti has a 45% market share in new car market, shouldn't they also have a similar percentage in used car market? simply because there will be more Maruti cars in used car market.

What would matter is who is buying the used car and who is selling them.
Maruti cars are generally bought by families who are going for their first cars, these buyers typically dont sell off thier cars soon as compared to buyers of sedans. Also given that indian
So if you take the cars coming into second hand market for sale, I am guessing there might be equal amount of Suzuki and other brand cars

[Rajeevraj]

Originally Posted by GeeTee TSI

So MTV can cannibalize (maybe it is) Maruti Suzuki new car sales. Or a joint promo can stimulate both!
Interesting bit of news, especially when OEMs are beset with one offering cannibalizing the other from the same stable

Yes, pretty sure they are cannibalizing. My first 3 cars were all from True Value. In the 2nd and 3rd case, I could have bought a new Maruti (or another manufacturer car) from a lower segment, but still went with a pre-owned from True Value.

In general I have felt comfortable with True Value. Because of the high volume of Maruti new car sales, most True Value outlets have a good selection of almost all models. The other manufacturer owned outlets more often than not, have very limited selection.

They also promote True Value aggressively. Running regular camps and road shows to encourage people to buy a True Value Car or sell their car to True Value and buy a new Maruti. They have special exchange bonus schemes for that.

The prices are on the higher side. But personally I considered it as a premium for peace of mind.

[tsk1979]

True value is definitely gaining traction, even in smaller cities apart from the metros.
The reason is simple. The used car market.

The used car market, esp in non metros is a hell hole. Case in point, we zeroed in on a 2011 Etios Petrol VX top model. Seller agreed for around 3:20.
The car seemed to be very well maintained, and had just 38K on the odo. Ran like a dream.

Paying 20-25K over the recommended price also seemed good as the tires were pretty new, and interiors clean.

However, when we ran the car through toyota dealer database, it was revealed that the car has run over 125000kms!!

This story was repeated for a 2010 swift done 55K(actual 110K) and a 2012 Dzire(20K-actual 65K).

So that to do? Go to a more trusted source.
Of course there are tampered cars there too, but there is also a high probability of finding good un-tampered cars at outlets like True Value

[desdemona]

Does Maruti Suzuki 'prop up'/'inflate' the resale 'value' of Maruti-badged cars, thereby creating a potent feedback loop that promotes herding-biased buying of their new cars, since 'resale' is SUCH a priority to the VAST majority of mass market buyers in India, more it would appear than in any other comparable country?

This bears investigation as a potentially anti-competitive practice, using market-pricing-power in an adjacent market to boost market-pricing in the main one.

If the CCI can investigate and pass adverse orders on the spares front as they did late last year...

[rrsteer]

Originally Posted by tsk1979

True value is definitely gaining traction, even in smaller cities apart from the metros.
The reason is simple. The used car market.

The used car market, esp in non metros is a hell hole. Case in point, we zeroed in on a 2011 Etios Petrol VX top model. Seller agreed for around 3:20.
The car seemed to be very well maintained, and had just 38K on the odo. Ran like a dream.

Paying 20-25K over the recommended price also seemed good as the tires were pretty new, and interiors clean.

However, when we ran the car through toyota dealer database, it was revealed that the car has run over 125000kms!!

This story was repeated for a 2010 swift done 55K(actual 110K) and a 2012 Dzire(20K-actual 65K).

So that to do? Go to a more trusted source.
Of course there are tampered cars there too, but there is also a high probability of finding good un-tampered cars at outlets like True Value

Actually since I just bought a used car - incidentally a used Etios VX Petrol -, I can say that even True Value, alteast in non metros is also open to this practice of fudging km readings.

I find Toyota U Trust to be the most trustworthy of all the manufacturer sponsored used car dealers. The problem with them is that they are certainly more expensive and they seem to be perennially holding very low levels of used car inventory.

Coming back to the car I purchased (through olx; personal seller), no matter how hard I tried to avoid it, I do feel I got shortchanged a bit. The car I purchased was 19k run, 2011 model and 2nd owner. It drives like new and looks new. Even now.

I verified the km readings from Toyota and confirmed all services, which were done regularly as per the 6 monthly schedule and thus it kind of proved to a very large degree the mileage was indeed genuine. And this led me to believe that
everything about the car was genuine and I paid the premium I did. By the way the spare tyre is untouched as of now.

What I didn't check was the doors and gaps between them. These are among the clearest tell tale of accidents having taken place. I found white paint spray on the inner part of the rubber beading that runs through the doors and also on a foam like substance just behind the hinges of the front door. Called up Toyota again to confirm all service history and they had no case of body repair registered. So when I went to drop my Innova for service, I had the car checked for any prior bodywork and the technician confirmed all doors have been repainted. Curiously, he maintained overall no major bodywork was done and whatever work has been done was restricted to the doors.
I have stopped thinking about this now, but once in a while, the though does disturb why were all the four doors repainted. And I feel I paid 35-40K more for it.

[noopster]

This thread gladdens me. Having experienced the joys of "pre-worshipped" ownership myself, I am now a die-hard fan of the used car market. My 2006 Swift Vxi purchased from First Choice as 3 year/30,000 km vehicle is (touch wood!) still going strong. I know others who are very satisfied with their purchases from Mahindra First Choice as well as Maruti True Value.

Actually I never knew that True value did multi-brand retail. And recently the likes of Audi and Mercedes have started multi-brand retail in the luxury segments as well, I think.

The future's bright, the future's pre-worshipped!

[Prash22]

If True Value is selling ~30,000 cars a month, it will be interesting to know the reasons why first time owners are disposing their Maruti Suzuki cars in this high number and the average retention period of the cars by the first time owners.

Although we say True Value has ~30K cars a month sales, the vehicle churn out of the plant is not going to change since these cars were already part of the earlier original car sales number but Maruti Suzuki as a parent company makes money out of the same car again that was sold earlier originally. I am sure some of these cars would have gone through multiple resale's and if it was Maruti Suzuki True Value who did the resale they have extracted the most out of it.

[sourabhzen]

I sold my 2005 Alto Lx to True Value in 2010 for 1.25 Lacs. In 2013 i bumped into the second owner at a service centre and got into conversation with him. the car was exactly in the same condition as I had sold. Only visible change was the new set of tyres and some minor touch ups. Even the seat covers were the same as I had installed. The new owner told me that he got the car for 1.75 lacs from True Value and he was very happy with the car and after sale service by Maruti. I think Maruti made a substantial profit from selling the car but at the same time gave tremendous amount of sense of security and service to the new buyer.
All in all it was a win win situation for me, True Value and the new owner.

[Asish_VK]

Truly amazing statistics,
It shows the herd mentality towards the brand"Maruti". They possess so much reputation in India. People are ready to plonk their money for any other brand cars sold thru their outlet eyes closed since its associated with Maruti. With the ads showcasing on their 120 points quality checks, wide dealer network, EMI options etc. they made people believe in true value as a safe place to buy used cars, considering the extra premium for peace of mind.

Even I will recommend true value as a safe bet for anyone looking for a used car

I don't think any other brand can pull this off in India.