[jazzy]

When I got a chance to stay and work in a country on the other side of the globe, what I did within a few days, was buy a pre-owned car. It was an obvious choice, an utter necessity. The moment I took the first ride, it was an indescribable moment, feeling like a baby bird just made the very first flight. It was my first car. What struck me was the ease with which I could buy the used car, how “matured” the market was compared to our own. The whole process of finding the dealers, the showcasing of long lists of inventories, the availability of the cars for a quick spin, third-party agencies specialising in thorough testing of each mechanical and electrical part and scoring those, fixing the potential value range, the transfer of money and the eventual transfer of ownership of the vehicle. This was a couple of decades back, a time when the use of the internet wasn’t so prevalent, everything was done offline.

Times have changed and our own online/offline dealers have more-or-less developed similar operating models, except for the part where the inspection agencies are not always third parties and so there could be biased reporting on the condition of some pre-owned vehicles. However, the ease at which we can sell our cars is amazing. I was able to get the whole process completed for my previous car, in about 10 days out of which about 9 days were spent on negotiating with the online dealer to relent to my perceived selling price. I can only assume that the ease of buying from such dealers would be equally great.

One thing which glaringly still isn’t at par with the other “matured” markets, is the price discovery or rather “lucrative value of pre-owned cars for buyers”. The online/offline dealers have cornered most of the inventory and just like the builder-contractor nexus in the real estate sector, they have deep pockets to sit on their inventories and wait until they are able to fetch good mark-up on the vehicles. They also need to showcase a good list of available cars and so, selling for lower margins doesn’t really work to their advantage. After all, cars are not highly consumable items that we need to replace ever so quickly, most of us still keep ours for at least a few years, sometimes over a decade (I did too).

This landscape has been changing rapidly though it may not be noticeable so easily to everyone. Car manufactures are gearing up to launch more models at more frequent intervals. Case in point - MG has announced that it will release a new model every 3-6 months! There was a time when Maruti used to take years to launch a new model. Our homegrown M&M has been launching new cars or upgrades almost every year now. Tata Motors has been launching new ones or updating old ones at a much quicker pace, albeit some of them are the so called “Dark” editions but there is a buzz every few months about some new launch or update. With so many new launches, some are bound to lose value in used car markets very quickly, especially the discontinued models.

Secondly, changing government regulations necessitate some powertrains to lose value faster. Diesels have been the chief victim, at least in some regions.

Thirdly, upcoming technologies are going to render some specific models not so desirable. A new battery tech, for example, could lead to a lot of cars lose their resale values quickly.

A critical piece of the puzzle that’s missing in our market, is the availability of trusted third party agencies who can do thorough checking of any vehicle and suggest accurate price range for any prospective buyer. When buyers have this trust, at least some of the prospective buyers would shift to buying used cars rather than going for new ones.

Most importantly, there is going to be an abundance of used cars in the near future, which should help in bringing prices down further. Pre-owned vs new car sales in India have crossed a ration 2:1, while it was 1:1 just a few years ago. However, it is over 3:1 in the US.

The debatable point is - are we moving to this future soon, in a few years may be, a future where few people buy new cars, used cars are very cheap compared to the new ones and the market for used cars is much bigger? Or are we going to continue in the current state for much longer as our cars per capita is still very low, we view the sellers with a lot of suspicion, we continue to find some pride in buying a new car and some kind of shame in telling others that it was pre-owned?

What would BHPians prefer to buy - new or used? Would that decision change if used cars were cheaper and a comprehensive report of each and every mechanical/electrical component of each car was available (not just service reports) from a trusted source? Would it help to decide if you knew that you as second/third owner would still be able to sell easily, when the time comes, without devaluing your car a lot? Do you still feel proud to tell others that you bought a new car and not a pre-owned one?

[youknowitbetter]

As a family we have bought equal number of new and pre-owned cars. Pre-owned cars have served us well. 2 pre-owned cars were just 10 months to 18 months old, so practically they were as good as new cam at really good price. As a matter of fact, I am looking for a pre-owned sedan as a second car, but this time I don't want to spend too much money, so may be okay to buyer relatively older car.

In terms of the process, my preference is to check with friends if they know someone who is looking to sell a car as its easier to rule out a 'lemon' eventuality! Let's see how it goes.

[nidhinpr]

Originally Posted by jazzy

A critical piece of the puzzle that’s missing in our market, is the availability of trusted third party agencies who can do thorough checking of any vehicle and suggest accurate price range for any prospective buyer. When buyers have this trust, at least some of the prospective buyers would shift to buying used cars rather than going for new ones.

Most importantly, there is going to be an abundance of used cars in the near future, which should help in bringing prices down further. Pre-owned vs new car sales in India have crossed a ration 2:1, while it was 1:1 just a few years ago. However, it is over 3:1 in the US.

The debatable point is - are we moving to this future soon, in a few years may be, a future where few people buy new cars, used cars are very cheap compared to the new ones and the market for used cars is much bigger? Or are we going to continue in the current state for much longer as our cars per capita is still very low, we view the sellers with a lot of suspicion, we continue to find some pride in buying a new car and some kind of shame in telling others that it was pre-owned?

I agree with many of your points, particularly concerning dealers stocking up inventory, which can drive up market prices and lead to selling at a premium. Additionally, the uncertainty surrounding the quality and condition of the product due to limited information and time with the machine being sold is a valid concern. Ultimately, dealers are running a business, and it's the buyer who may end up at a disadvantage in such transactions.

If you were to ask me, I would definitely opt for a preowned machine, especially from a financial perspective. It's a well-known fact that vehicles depreciate rapidly once they leave the showroom, typically losing 10-20% of their value immediately and up to 40-50% within 4-5 years. While sellers and dealers may try to argue otherwise and inflate prices, with the right data and analysis, you can negotiate effectively. Insured Declared Value (IDV) serves as a useful indicator for estimating the ideal price of a vehicle, as it's a key factor in calculating insurance premiums. Remember, higher IDV translates to higher insurance premiums. Additionally, platforms like Orangebookvalue provide insights into the resale value based on various factors. Any price above this value can be considered a premium. In the process of gathering information, it's crucial to utilize all available tools and conduct thorough research. Relying solely on third-party assessments may not suffice. Testing the machine and identifying potential issues requires skill and experience, which not everyone possesses. Having an unbiased companion or a skilled mechanic by your side can greatly assist in making an informed decision.

From what we've discussed so far, it's evident that the process of buying a vehicle can be quite daunting and time-consuming. Many people opt for dealerships simply because they seem like the easier option from a distance. However, once you're in the thick of it, the outcome largely depends on individual skills or luck. Dealers often prioritize making a sale rather than addressing potential issues or providing thorough service. That's why I prefer to deal directly with the owner, regardless of the number of previous owners or kilometers driven. If the owner can provide sufficient data for me to evaluate the vehicle, I feel more confident in the transaction.

Indeed, the decision to buy pre-owned or new vehicles is deeply influenced by individual ideologies and needs. While I personally prefer pre-owned vehicles, my dad always opts for new ones due to his distrust of the previous users' history. We've had our VW 1.2L Polo for 14 years now, and it's still going strong.

There's no shame in admitting whether your vehicle is pre-owned or new. It ultimately comes down to individual self-esteem and how much society and social status factor into one's decisions. For enthusiasts or those with strong self-actualization, this distinction isn't a concern. However, for those who prioritize showcasing their status or fear losing their pride, it can become an issue.

I'd suggest simply embracing the moment and spending more time enjoying the drive/ride without overthinking it. Make sure to educate yourself and thoroughly research the vehicle you're interested in & take your time before making a final decision. Additionally, it's reasonable to pay a higher price for a vehicle in pristine condition or one that's rare to find.

[ritedhawan]

My father always preffered buying used cars since 2003, and in the space of 21 years he bought to the tune of 4 used cars and 3 new ones. I bought my first car which was a 10 year old Honda Accord which is set to expire this May 2024.

Due to my bad financial condition. My father has decided to buy us a used car and has asked me and my wife to look for one before end of April. All the cars were bought offline from those age old car dealers like the ones in Karol Bagh, New Delhi.

Those who have driven cars past 6 digit mileage and have superficial knowledge of what goes under the hood of the car, can never be fooled by illegitimate practices or lack of the checks performed by offline or online car dealers. People who are well versed, only need to drive an intended used car to buy for 15-20 minutes to know exactly whats in place and whats not. They may not even require the opening of the hood to investigate, or scrutinize service records, or not able to figure out meter tinkering.etc. Whether its offline or online, a vehicle under its hood wont lie, and if a car has been taken care whether via ASC or FNG, whether it was driven by considerate owners or not. When a well versed and experienced buyer drives its for a couple of minutes, the vehicle wont lie and it should show its true colours for the buyer to percieve and take note of, and then its his\her choice to go for the purchase or not. This is an important aspect that holds its ground.

I am in the midst of writing a long ownership experience of my third-hand used Honda Accord and would soon release it on TBHP.

[Turbosailor]

Originally Posted by jazzy

third-party agencies specialising in thorough testing of each mechanical and electrical part and scoring those, fixing the potential value range, the transfer of money and the eventual transfer of ownership of the vehicle. This was a couple of decades back, a time when the use of the internet wasn’t so prevalent, everything was done offline.

You have mentioned many valid points excellent observations. As you mentioned main concern for a person who is looking for a used car in the market is the absence of a valid and trustworthy 3rd party agency for valuation and validation of technical parameters. So now a customer is made to believe what the dealer is saying or just looking for service history. That's the main reason many manufactures have started their own used car programs so most technical details are looked after but they will be quoiting a premium from the actual price. If I am buying any used car from the market it will be from manufactures preowned facility or from a very close friend.

[jazzy]

Originally Posted by Turbosailor

many manufactures have started their own used car programs so most technical details are looked after but they will be quoiting a premium from the actual price.

This is another manifestation of the unfair costing in the pre-owned car market. Essentially what the manufacturers are saying is "Don't trust the dealers' assessment. We are more trustworthy, so we'll charge you a premium", though the value of the vehicle would be the same.

[RGK]

Originally Posted by jazzy

What would BHPians prefer to buy - new or used? Would that decision change if used cars were cheaper and a comprehensive report of each and every mechanical/electrical component of each car was available (not just service reports) from a trusted source? Would it help to decide if you knew that you as second/third owner would still be able to sell easily, when the time comes, without devaluing your car a lot? Do you still feel proud to tell others that you bought a new car and not a pre-owned one?

I have bought three preowned cars out of the four I purchased. Definitely, they are cheaper and better value for money if you are able to source a good and reliable one, but one needs to do a lot of homework. During a preowned vehicle purchase, one has to be quick to act, else you may miss a good one. Another piece of advice is that if one is looking for a preowned, go for the top-end variant, preferably.

I saw a few cars in Spinny and interacted with their evaluators, and found they do a good job. All electrical and mechanical components are thoroughly checked for the cars that are categorised under "Assured". The number of owners does matter during a resale, but it doesn't matter if the car is very good for one's own use. I missed a damn good Crysta V - (only 35K done, 2nd owner).

I feel more proud if my car is in immaculate condition than a new or second-hand one.

NB: Even the digital odometer reading can be manipulated, which is a point to note.

[Mystic]

I will not hesitate to buy a used car in USA as we have car fax which can be trusted. In India, one has to personally get the data by going to the service centre etc and there is a risk involved as it is not fool proof. I will NEVER buy a used car in India and this is my personal opinion.

When it comes to buying a lemon, it is same in USA and India and it all depends on your luck. In case of an unfortunate situation of buying a lemon, atleast there are laws in USA to fight for justice and we have absolutely no lemon laws in India.

[techwhiz]

Originally Posted by Mystic

I will not hesitate to buy a used car in USA as we have car fax which can be trusted. In India, one has to personally get the data by going to the service centre etc and there is a risk involved as it is not fool proof. I will NEVER buy a used car in India and this is my personal opinion.

When it comes to buying a lemon, it is same in USA and India and it all depends on your luck. In case of an unfortunate situation of buying a lemon, atleast there are laws in USA to fight for justice and we have absolutely no lemon laws in India.

Very true. This is why I always only buy new cars in this country.

[darkgamer]

I might bring an interesting point which hasn’t been yet considered:

India is a fast growing car market and very immature compared to western ones. Since the per capita car ownership is very low, the number of cars in the second hand market too are very low (as fewer people owned cars 5/10 years ago).

This is what’s causing the ‘mafia-fication’ of the used car market. Dealers are able to corner the market because it’s tiny. However, when the current and next crop of owners sell their cars and second hand market goes bigger and bigger, they won’t be able to game the market anymore and natural market forces will take over.

I strongly believe the used car market will get a lot better, especially for the choices available and the price discovery. Also, EVs deteriorating faster helps the used car buyer immensely (newer batteries last 500k+ km too, so no worries there).

[Jaguar]

Originally Posted by RGK

I saw a few cars in Spinny and interacted with their evaluators, and found they do a good job. All electrical and mechanical components are thoroughly checked for the cars that are categorised under "Assured".

NB: Even the digital odometer reading can be manipulated, which is a point to note.

Originally Posted by Mystic

In India, one has to personally get the data by going to the service centre etc and there is a risk involved as it is not fool proof. I will NEVER buy a used car in India and this is my personal opinion.

I am in the market with a budget of 30l and exploring both the new and pre-owned options. But the used car market in Bangalore is insane. Audi approved plus, for example, is quoting 50+ for a 2020 A4 which is more than the current price of a new A4 in NCR . I saw a bruised and battered 3 series with them which had just arrived. A week later, saw the same car advertised as being in a mint condition.

I expected the organized players to be better but that's not the case. My experience with Spinny Max, especially has been disappointing. Checked out a couple of DL and HR registered BMWs and both of them were missing the service history. As per the MID, the cars had not visited the BMW service center since purchase, and the records the executive pulled out from his filess also indicated the same. The call center executive said I can take the car to a BMW workshop to get it checked but the agent on-site person says I need to buy the car first and get it checked within the 5-day return window.

I've decided that I will go for a used car only if I am getting it from the owner directy, but that is a slow process. Sadly had to let go of a mint condition Octavia of a Bhpian since I couldn't find a comfortable driving position thanks to my long legs

[SixPistons]

Originally Posted by Jaguar

I expected the organized players to be better but that's not the case. My experience with Spinny Max, especially has been disappointing. Checked out a couple of DL and HR registered BMWs and both of them were missing the service history. As per the MID, the cars had not visited the BMW service center since purchase, and the records the executive pulled out from his filess also indicated the same. The call center executive said I can take the car to a BMW workshop to get it checked but the agent on-site person says I need to buy the car first and get it checked within the 5-day return window.

I've decided that I will go for a used car only if I am getting it from the owner directy, but that is a slow process.

I can echo your thoughts here.

This past Saturday, my father and I went to checkout an XUV700 Petrol AT at Spinny Dwarka. The silver XUV had about 30k on the ODO. Car had some scratched out pieces inside, a whole layer of dust on the dashboard on the wax from last clean up, a ton of scratches. Furthermore there was just so much repainting including the front fender, bumper, bonnet, left doors, rear bumper and so on. It felt like most of the car was repainted and that too badly. Front right fender had significant paint chipping showing the layer underneath. Paint may have got to 200 micro-m of thickness probably on those areas.

Apart from surface, there were so many issues mentioned by previous owner in service history that it became clear they sold it out of frustration. It was available for almost 1/4th down, given current market price for an AX7. The test drive felt like the engine was older than ODO’s mark. But the last service definitely matched up the markings. Not sure how previous owner drove it in about 18-20 months that it became so rough. Our impression is that we tested a probably accidental vehicle.

Not the Spinny Assured experience we expected when we walked in. I have read some good and some not-so-good stories here about BHPians buying from Spinny over the last few years, and my brother’s experience with his i20 back in 2020 has been pretty good. He still has the car.

But what I have seen recently tells me Spinny isn’t much different from Cars24/OLX/Mahindr First Choice and the likes when it comes to vehicle quality, but they are pretty bent on charging their quoted high-tag prices.

[jazzy]

Originally Posted by darkgamer

EVs deteriorating faster helps the used car buyer immensely (newer batteries last 500k+ km too, so no worries there).

On this point, Vinfast has a counter strategy that has worked well for them in Vietnam and also for consumers. They provide 10 yr replacement warranty for batteries in their cars, so anytime the battery performance goes below a certain level, they replace it free of charge. Other EV manufacturers may have similar warranties but 10 yrs is a long enough time, enough to pip some of those on the fence to buy a new EV.

[rakesh_r]

Originally Posted by SixPistons

I have read some good and some not-so-good stories here about BHPians buying from Spinny over the last few years, and my brother’s experience with his i20 back in 2020 has been pretty good. He still has the car.

A year back i got a 2013 Wagon R from Spinny. I pretty much knew i will be paying a significant amount, much higher than the market price. I did TD couple of small hatchbacks and found lot of issues in everyone of them. As i almost left their hub, their executive informed me that a 2013 Wagon R had just entered their hub post refurbishing. With little hopes checked out the car, ended up buying the car then and there as the car was in pretty good condition. Post purchase I got the steering rack and engine mounts changed.
I think Spinny is no different from their competitors. What attracted me was a 5 day return policy, no questions asked. This gave me sufficient time to analyse and get the car inspected (MASS later gave me a clean chit based on the service history).
Would i buy a preowned car? Yes but only when I replace the Wagon R with another beater car for the city. I will still prefer buying a new car for primary purposes.

[maddy42]

Bought a Preloved vehicle a couple of months ago and listing out the pros and cons:

Pros: Got a Seltos with less then 15k kms done with a 20% haircut.
Owner was someone known to me but the contact details was through a agent.
Car was well maintained with service history and owner was a little transparent.

Now coming to the cons of this experience:
Dealers have cornered this market and it is high time india needs a platform like Craigslist along with carfax for listings and transparency.

Paper work: The RC transfer is taking ages even though i am going through a Agent and current RTO is the biggest roadblock as my vehicle is transferred to my name but the doc printing hasnt been done.

Loan clearance: Getting the loan document cleared needed me to travel twice to the bank branch which in my case was two hours away all because the RTO needed a SEAL with the banks name. Again RTO is the culprit here.

New Loan: The new loan paper work and running around is all my headache with a auto loan taking longer then a personal loan.

Lastly we need to go through classifieds, schedule appointments with the owners and do all the searches ourself like sherlock holmes to get a good car.

In the end it is worth it, but can this experience be improved? Definitely and that is why all the platforms like Spinny Cars24 etc are making bank at crazy valuations of their companies and the cars.