forpressrelease Mail to a Friend
forpressrelease Rate forpressrelease forpressrelease forpressrelease forpressrelease forpressrelease 

Maruti Suzuki, Mahindra, Hyundai, Honda were the most popular car brands during the lockdown

2022-08-11 12:12:59 Automotive


July 23, 2020, India: OLX’s 4th edition of the Auto Note - pre-owned car industry’s most comprehensive knowledge repository - reveals that the pre-owned car market has seen steady recovery and growth in the period between April - July. As per the report, the demand for pre-owned cars has surged by ~ 25% in July vs Feb led especially by the sedan category, SUV and hatchback category where demand and supply in July have soared. It further cites that 55% of respondents plan to use a personal vehicle in the next 6 months, and Bharat i.e. non-metro India, is a key driver in this revival in demand. The spurt in demand for pre-owned personal vehicles is not only owing to hygiene concerns but also due to reduced budgets for buying a personal vehicle. As per industry data, the pre-owned car market outnumbers the new car market by 30% in volume.

In order to understand the impact of COVID-19 on the Indian automobile industry in general, and the pre-owned car industry in particular, OLX and OLX CashMyCar conducted a study with over 3,800 respondents between April - June 2020, and also analysed indicators from over 450,000 monthly average buyers+sellers on the OLX platform over the same period. The insights from the combined assessment are discussed in detail in the OLX Auto Note Study 4 COVID Edition. The highlights are mentioned below:

On the road to recovery: With 56% of the respondents planning to buy a car in the next 3-6 months, the automobile industry is expected to witness green shoots of recovery. 54% of these plan to buy a pre-owned car in the next 3-6 months, indicating that the pre-owned category will see faster recovery in terms of demand. However, their preference is likely to veer towards entry-level models as 72% of respondents have reduced their car-buying budget due to COVID-19. For new cars, 39% of buyers have a budget under INR 3 lakhs, with another 24% having a budget between INR 4 and 7 lakhs. For a pre-owned car, 50% of buyers have a budget under INR 3 lakhs while 20% have a budget between INR 4 and 7 lakhs.

Bharat powering demand and supply of pre-owned cars: Of all the respondents keen to buy a car in non-metro towns, 70% of them are interested in pre-owned cars and only 30% are interested in a new car. The narrative flips for metro towns, wherein 70% of the respondents are more likely to opt for a new car.

Bharat revs in style: Non- metros are revving up both demand and supply for luxury cars and catching up to their metro counterparts as well. Non- metros and metros between Jan-June listed 49% and 51% of luxury cars on OLX respectively. In terms of demand, between Jan-June non-metros and metros generated 45% and 55% of the demand respectively. OLX estimates that non-metros are expected to surpass metros in demand and supply for the full year by the end of 2020. The key factor for this is non-metros have seen the lesser impact of COVID vs metros which led to fewer lockdown restrictions and rural economy is improving as well.

Budgets are dented: 72% of people surveyed across Metros and Non-Metros shared that COVID-19 has dented their budgets to buy a car. Across Metros and Non-Metros, 50% of respondents have a budget of lower than 3 lakhs for a car.

Preference for personal transport options increases: Owing to hygiene concerns and to avoid exposure to fellow passengers, 55% of respondents intend to commute in a personal car in the future vs pre-COVID (48%). Preference for public transport including cabs is on the decline.

Non-millennials are key contributors to value in the coming months for the pre-owned automobile industry: 58% of millennials (between the ages of 21-37) plan to buy a car in the next 6 months, while 50% non-millennials (37+ years old) plan to do the same. Interestingly, 63% of these non-millennials plan to buy a pre-owned car in the next 6 months, and only 37% plan to buy a new car. Among millennials, the split is an even 50%-50%. Very likely, most millennials are first-time buyers of a car, whereas non-millennials already have a personal vehicle and want to have a second one. Owing to higher incomes, non-millennials also have larger budgets. Only 25% of non-millennials have a budget of fewer than 3 lakhs for a new car, compared to 43% among millennials.

Existing car owners still plan to sell their cars: 79% of those who intended to sell their cars pre-COVID, were still firm on that plan and 72% of the respondents plan to sell their cars as early as a month after respective lockdown restrictions in their cities are eased further. 62% of the sellers would prefer home inspection for getting their car evaluated and 51% of them are willing to pay for a home inspection as well if required.

Renewed demand will enable dealers to liquidate their existing inventory: OLX estimates that most dealers will migrate to online platforms to cater to the renewed interest by consumers as most dealers currently have 60%-80% of unsold inventory. A majority of pre-owned car dealers will guide customers through online platforms before customers decide to pay in-person visits for final closure. Larger dealerships will offer AMCs, and undertake home delivery of cars to adhere to safety regulations.

Company :-80 dB Communications

User :- Isha Mathur


Mobile:- +91 9999803528


Related Post