Australia Used Car Financing Market Size (2024 - 2029)

The Australia used car financing market is anticipated to experience moderate growth over the forecast period, driven by a shift in consumer preferences towards personal vehicle ownership and financial instability post-pandemic. The market's expansion is supported by a consolidated landscape of OEMs, auction houses, and pre-owned dealers offering diverse financing options. Despite a temporary decline during the Covid-19 pandemic due to economic constraints and lockdowns, the market has rebounded, with financing becoming increasingly essential as car ownership evolves from a status symbol to a necessity. The absence of a national regulatory body for used car financing in Australia leads to community-based organizations among dealers to maintain competitive pricing and support.

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Market Size of Australia Used Car Financing Industry

Australia Used Car Financing Market Overview
Study Period 2019 - 2029
Base Year For Estimation 2023
Forecast Data Period 2024 - 2029
Historical Data Period 2019 - 2022
CAGR 8.96 %
Market Concentration High

Major Players

Australia Used Car Financing Market Major Players

*Disclaimer: Major Players sorted in no particular order

Australia Used Car Financing Market Analysis

Australia used car financing market was valued at USD 580.54 million in 2021 and expected to surpass a net valuation of USD 971.48 million by 2027 end, registering a solid CAGR growth of 8.96% during the forecast period.

The used car market in Australia is highly consolidated with several OEM, auction houses, and pre-owned dealers who thrive to expand their fleet size to offer a wide pool of financing opportunities to their clients.

During Covid-19, Australia used car financing witnessed a steady decline owing to the spread of the virus and people avoided purchasing cars amid an economic crisis. In addition, markets, showrooms, and auction events were closed down as of strict lockdown measures prevailed by the Australian government. Although, after Q1 2021, everything was again on track with the used car financing business achieving a growth phase as well.

Major consumers across Australia are facing financial instability post-pandemic surge in the selling of newer cars. This is likely to mark as major growth lever for the market. In addition, the rising consumer preference towards owning a personal vehicle and avoiding public transportation is also identified as key fueling factor for used car market across the nation. Ownership of cars, which used to be a status symbol long ago, has become a necessity in recent times and thus is deeply identified by the key financers and pre-owned car owners.

There is no established national association in place in Australia to maintain the finacing business for used cars. Dealer clusters form their own community-based organizations to ensure that pricing is comparable within the cluster and to hold gatherings to boost support for the group. By working with multi- and auto-financing businesses, independent used car dealers reduce their exposure to buyers' financial concerns. Cars older than ten years are not eligible for financing because of their reduced lifespan, increased risk of damage, and diminished value. When compared to new car purchases, there is a higher proportion of cash payments because the price can be 20-30% lower.

Condiering these factors, demand for used car financing in Australia is ected to witness moderate groth rate during the forecast period.

Australia Used Car Financing Industry Segmentation

Used financing is the service that offers used car to consumers at much-lowered prices at affordable EMI instalment. These instalments are divided based on loan amount, tenure with some fixed rate of interest.

Based on the car type, the market is segmented into hatchback, sedan, and utility vehicles. Based on the financier, the market is segmented into OEMs, Banks, and NBFCs. The report covers the market size in value (USD million) for all the above-mentioned segments

Car Type
Hatchbacks
Sedans
Sports Utility Vehicle
Multi-Purpose Vehicle
Financier
OEM
Banks
NBFC's
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Australia Used Car Financing Market Size Summary

The used car financing market in Australia is characterized by a high level of consolidation, with numerous original equipment manufacturers (OEMs), auction houses, and pre-owned dealers working to expand their offerings. This market experienced a downturn during the COVID-19 pandemic due to economic uncertainty and lockdown measures, which led to a temporary decline in car purchases. However, by early 2021, the market began to recover, driven by a shift in consumer preferences towards personal vehicle ownership as a result of financial instability and a desire to avoid public transportation. The absence of a national association to regulate used car financing has led to the formation of community-based organizations among dealer clusters, which help maintain competitive pricing and support among members. Despite challenges such as the ineligibility of cars older than ten years for financing, the market is expected to see moderate growth, supported by the affordability of pre-owned vehicles and the availability of financing options with lower initial down payments.

The demand for used car financing in Australia is further bolstered by the offerings from OEMs, who provide a wide range of pre-owned vehicles with attractive financing terms. The hatchback segment, in particular, has shown resilience during the pandemic, with its affordability and tax benefits making it a popular choice among consumers. The market is fragmented, with both organized and unorganized players, and the ease of obtaining loans from non-banking financial companies (NBFCs) is expected to enhance their market position. Key players in the industry include Adelaide Vehicle Centre, Dutton Group, Mozo Pty Ltd., and major banks like National Australia Bank Limited and Australia and New Zealand Banking Group Limited. The increasing digitization of the purchasing process and the introduction of value-added services are anticipated to drive further growth in the used car financing market, particularly for hatchbacks, as consumers seek cost-effective and efficient vehicle ownership solutions.

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Australia Used Car Financing Market Size - Table of Contents

  1. 1. MARKET DYNAMICS

    1. 1.1 Market Drivers

    2. 1.2 Market Restraints

    3. 1.3 Porters 5 Force Analysis

      1. 1.3.1 Threat of New Entrants

      2. 1.3.2 Bargaining Power of Buyers/Consumers

      3. 1.3.3 Bargaining Power of Suppliers

      4. 1.3.4 Threat of Substitute Products

      5. 1.3.5 Intensity of Competitive Rivalry

  2. 2. MARKET SEGMENTATION (Market Size in Value USD Million)

    1. 2.1 Car Type

      1. 2.1.1 Hatchbacks

      2. 2.1.2 Sedans

      3. 2.1.3 Sports Utility Vehicle

      4. 2.1.4 Multi-Purpose Vehicle

    2. 2.2 Financier

      1. 2.2.1 OEM

      2. 2.2.2 Banks

      3. 2.2.3 NBFC's

Australia Used Car Financing Market Size FAQs

The Australia Used Car Financing Market is projected to register a CAGR of 8.96% during the forecast period (2024-2029)

Adelaide Vehicle Centre, Dutton Group, Mozo Pty Ltd., National Australia Bank Limited and The Australia and New Zealand Banking Group Limited are the major companies operating in the Australia Used Car Financing Market.

Australia Used Car Financing Report Snapshots

Australia Used Car Financing Market Size & Share Analysis - Growth Trends & Forecasts (2024 - 2029)