Market Size of Used Car Financing Industry
| Study Period | 2019 - 2029 |
| Base Year For Estimation | 2023 |
| CAGR | 10.78 % |
| Fastest Growing Market | Asia-Pacific |
| Largest Market | Asia-Pacific |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order |
Need a report that reflects how COVID-19 has impacted this market and its growth?
Used Car Financing Market Analysis
The Global Used Car Financing Market is valued at USD 244.17 billion and is expected to reach USD 453.08 billion over the coming five years, with a combined CAGR of 10.78% during the same period.
The global used car market is moderately consolidated with several OEMs, auction houses, and pre-owned dealers who strive to expand their fleet size to offer a wide pool of financing opportunities to their clients.
During COVID-19, globally, used car financing witnessed a steady decline owing to the spread of the virus, and people avoided purchasing cars amid the economic slowdown. In addition, markets, showrooms, and auction events were closed down as strict lockdown measures were imposed by the regional government. Although, after Q1 2021, everything was on track, with the used car financing business achieving the pre-pandemic growth rate.
Major consumers around the globe are facing financial instability post-pandemic, which, in turn, has boosted the demand for used cars. This is likely to be a major growth factor for the market. In addition, the rising consumer preference toward owning a personal vehicle and avoiding public transportation is also identified as a key fueling factor for the global used car market. Ownership of cars, which used to be a status symbol long ago, has become a necessity in recent times and is deeply identified by the key financers and pre-owned car owners.
Furthermore, the Asia-Pacific region has been identified as the epi-center of the rising demand for used cars. The region holds a population density of middle and lower-income group classes that are anticipated to hold a large share in financing used cars.
Thus, due to the above mentioned factors, the demand in the market studied is expected to witness a high growth rate over the forecast period.
Used Car Financing Industry Segmentation
Used car financing is the service that offers used cars to consumers at much-lowered prices with affordable EMI installments. These installments are divided based on the loan amount and tenure, with some fixed rate of interest.
The Global Used Car Financing Market is segmented by Car type (Hatchbacks, Sedans, Sports Utility Vehicle, and Multi-purpose Vehicle), by Financier (OEM, Banks, and Non-Banking Financing Companies), and by Geography (North America, Europe, Asia-Pacific, and Rest of the World). For each segment, the market sizing and forecasts have been provided on the basis of value (in USD million) and volume (in metric tons).
| By Car Type | |
| Hatchback | |
| Sedan | |
| Sports Utility Vehicle | |
| Multi-purpose Vehicle |
| By Financier | |
| OEM | |
| Banks | |
| Non-Banking Financial Company |
| By Geography | ||||||||
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Used Car Financing Market Size Summary
The global used car financing market is experiencing a significant transformation, driven by evolving consumer preferences and economic factors. The market is moderately consolidated, with various original equipment manufacturers (OEMs), auction houses, and pre-owned dealers expanding their offerings to provide diverse financing options. The COVID-19 pandemic initially caused a decline in the market due to economic uncertainties and lockdown measures, but the sector rebounded by early 2021, reaching pre-pandemic growth levels. The demand for used cars has surged as consumers face financial instability post-pandemic, leading to a preference for personal vehicle ownership over public transportation. This shift is particularly pronounced in the Asia-Pacific region, where a dense population of middle and lower-income groups is driving the demand for affordable pre-owned vehicles.
The financing landscape for used cars is evolving, with OEMs and non-banking financial companies (NBFCs) playing pivotal roles. OEMs are expanding their financial services offerings, providing competitive financing options that reduce the burden of upfront payments. This trend is supported by strategic partnerships between auto manufacturers and financial institutions, enhancing the availability of financing solutions. In the Asia-Pacific region, countries like China and India are witnessing a surge in demand for used car financing, with NBFCs capitalizing on this trend despite challenges such as rising costs of funds. The market's growth is further bolstered by the ease of obtaining loans from NBFCs, which are becoming increasingly popular among consumers seeking affordable financing solutions for pre-owned vehicles.
Used Car Financing Market Size - Table of Contents
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1. MARKET DYNAMICS
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1.1 Market Drivers
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1.2 Market Restraints
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1.3 Porters Five Force Analysis
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1.3.1 Threat of New Entrants
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1.3.2 Bargaining Power of Buyers/Consumers
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1.3.3 Bargaining Power of Suppliers
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1.3.4 Threat of Substitute Products
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1.3.5 Intensity of Competitive Rivalry
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2. MARKET SEGMENTATION (Market Size in Value USD Billion)
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2.1 By Car Type
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2.1.1 Hatchback
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2.1.2 Sedan
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2.1.3 Sports Utility Vehicle
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2.1.4 Multi-purpose Vehicle
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2.2 By Financier
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2.2.1 OEM
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2.2.2 Banks
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2.2.3 Non-Banking Financial Company
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2.3 By Geography
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2.3.1 North America
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2.3.1.1 United States
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2.3.1.2 Canada
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2.3.1.3 Mexico
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2.3.1.4 Rest of North America
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2.3.2 Europe
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2.3.2.1 Germany
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2.3.2.2 United Kingdom
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2.3.2.3 France
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2.3.2.4 Russia
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2.3.2.5 Spain
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2.3.2.6 Rest of Europe
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2.3.3 Asia-Pacific
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2.3.3.1 India
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2.3.3.2 China
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2.3.3.3 Japan
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2.3.3.4 South Korea
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2.3.3.5 Rest of Asia-Pacific
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2.3.4 Rest of the World
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2.3.4.1 Brazil
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2.3.4.2 Argentina
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2.3.4.3 United Arab Emirates
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2.3.4.4 Saudi Arabia
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2.3.4.5 Other Countries
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Used Car Financing Market Size FAQs
What is the current Used Car Financing Market size?
The Used Car Financing Market is projected to register a CAGR of 10.78% during the forecast period (2024-2029)
Who are the key players in Used Car Financing Market?
The Bank of China, Ally Financial, HSBC Holdings plc, JPMorgan Chase & Co and The Bank of America Corporation are the major companies operating in the Used Car Financing Market.
