Market Size of India Used Car Industry
![India Used Car Market Summary](https://s3.mordorintelligence.com/india-used-car-market/1645982247658_india-used-car-market_Market_Summary.webp)
Study Period | 2018-2027 |
Base Year For Estimation | 2021 |
Market Size (2023) | USD 27.47 Billion |
Market Size (2028) | USD 55.49 Billion |
CAGR (2023 - 2028) | 15.10 % |
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?
India Used Car Market Analysis
The India Used Car Market size is expected to grow from USD 27.47 billion in 2023 to USD 55.49 billion by 2028, at a CAGR of 15.10% during the forecast period (2023-2028).
The COVID-19 pandemic had a minimal impact on the industry. With the increased number of people preferring individual mobility and more finance options available in the used car market, the market is set to grow considerably. Due to the pandemic's reduced cash inflow, buyers have been forced to look for alternatives to new cars, and the used car industry has high growth potential in this regard. As the pandemic has hampered new vehicle sales and production, the used car market is gaining traction among buyers.
Over the long term, the standardised dealership experience, high price experience, and high financing cost for used cars may stifle the market's growth. With the implementation of the new BS-VI emission standards by the Government of India, the technological cost of cars to meet the standards will be borne by consumers. The companies' emphasis on reducing diesel car production is expected to increase demand for compact diesel cars in the price and mileage-sensitive Indian market.
A few years ago, the new-to-used car ratio was 1:1.2, but it is now 1:2.2. When ten new cars are sold, the market has 22 used cars available for purchase. The average holding time of a new car has decreased from 5-6 years to 3 years. The used car category has provided many options for first-time buyers. In terms of buyer preferences and requirements, the trend in the used car market mirrors the trend in the new car market. Buyers in the used car segment, on the other hand, are more likely to try out new brands. This is not the case with new vehicles.
- Maruti Suzuki, on the other hand, has long been the top choice for used car buyers and has a majority market share in the new car market.
- Moreover, Only 17% of the market is accounted for by the organised sector. Today, the majority of car purchases and sales are conducted informally.
Although India has seen tremendous growth in the used car market, there is still room for future growth through the organised sector, as the ratio of new cars to used cars in mature markets such as the United States and Europe is 1:3. Overall, the Indian used car market appears to be on the right track.
- In June 2022, Porsche has made an official announcement that it will launch a used-car business in India on June 8, 2022, under its new sub-division, Porsche Approved. This new business will be launched at the Porsche Centre Kochi in Kerala.
Meanwhile, other German luxury automakers such as Audi, BMW, and Mercedes-Benz already have pre-owned car operations in the country.
However, lack of standardization and awarness among customer may hamper the market growth duirng the forecast period.
Based on Aforementioned Points the target market is expected to grow with a significant rate in the upcoming time-period.
India Used Car Industry Segmentation
A used car, also known as a pre-owned vehicle or a secondhand car, is one that has previously been owned by one or more retail owners.
India's Used Car Market is segmented into Vehicle Type, Vendor Type, and Fuel Type. By Vehicle Type, the market is segmented into Hatchbacks, Sedans, and Sports Utility Vehicles. By vendor type, the market is segmented into Organized and Unorganized. By Fuel Type, the market is segmented into Petrol and Diesel.
By Vehicle Type | |
Hatchbacks | |
Sedans | |
Sports Utility Vehicles (SUV) |
By Vendor Type | |
Organized | |
Unorganized |
By Fuel Type | |
Petrol | |
Diesel |
India Used Car Market Size Summary
The Indian used car market is experiencing significant growth, with a compound annual growth rate (CAGR) expected to be robust during the forecast period. This growth is largely driven by factors such as increased preference for individual mobility, availability of finance options, and a shift in consumer behavior due to reduced cash inflow caused by the pandemic. Additionally, the market is benefiting from the reduced sales and production of new vehicles. However, potential challenges such as high financing costs and new emission standards could hinder the market's growth. The industry is currently in a transition phase, moving from an unorganized to an organized system, with a rising middle class and young population being key drivers of this change. The market is also characterized by a higher availability of used cars compared to new ones. Additionally, the average holding time for a car has decreased, providing more options for first-time buyers. Despite the growth, there is still potential for further expansion, particularly through the organized sector. Key trends in the market include growing demand for luxury used cars and increased activities from key players such as Maruti Suzuki and Porsche. However, lack of standardization and awareness among customers could pose challenges to market growth.
Explore MoreIndia Used Car 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 Industry Attractiveness - Porter's Five Forces 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 USD Billion)
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2.1 By Vehicle Type
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2.1.1 Hatchbacks
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2.1.2 Sedans
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2.1.3 Sports Utility Vehicles (SUV)
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2.2 By Vendor Type
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2.2.1 Organized
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2.2.2 Unorganized
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2.3 By Fuel Type
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2.3.1 Petrol
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2.3.2 Diesel
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India Used Car Market Size FAQs
How big is the India Used Car Market?
The India Used Car Market size is expected to reach USD 27,470.54 million in 2023 and grow at a CAGR of 15.10% to reach USD 55,493.72 million by 2028.
What is the current India Used Car Market size?
In 2023, the India Used Car Market size is expected to reach USD 27,470.54 million.