Global Used Car Market Overview, 2024-29

Market Dynamic

Market Drivers • Changing Consumer Attitudes: Shifting consumer attitudes toward car ownership also drive the used car industry. With an increasing focus on shared mobility services, such as ride-hailing and car-sharing, some consumers prefer to buy used cars for personal use instead of committing to long-term new car ownership. This change in mindset contributes to the overall demand for used vehicles. • Supply Chain Disruptions: Supply chain disruptions affecting the production of new cars can indirectly drive the used car market. When there are delays in the production of new models due to factors like global events, natural disasters, or component shortages, consumers may turn to the used car market for immediate vehicle needs, bolstering demand for pre-owned vehicles. Market Challenges • Financing and Credit Accessibility: Securing financing for used cars can be a challenge for some consumers, especially if they have limited credit history or face higher interest rates. Improving access to affordable financing options for used cars is crucial for broadening the market and making pre-owned vehicles more accessible to a diverse range of buyers. • Evolving Automotive Technologies: While technological advancements are a driver, they also present challenges. The rapid evolution of automotive technologies can result in older used cars lacking the latest safety features and connectivity options, potentially affecting their market appeal. Striking a balance between offering modern features and maintaining affordability is a challenge for the used car industry. Market Trends • Subscription Services and Leasing: The emergence of subscription services and leasing options for used cars is a growing trend. This model allows consumers to enjoy the benefits of car ownership without the long-term commitment. Subscribers can access a variety of vehicles, and at the end of the subscription period, they can choose to continue with the current vehicle or switch to a different one. • Data-Driven Decision-Making: The use of data analytics is becoming increasingly prevalent in the used car industry. Dealers and online platforms leverage data to gain insights into market trends, pricing strategies, and customer preferences. This trend facilitates more informed decision-making, helping industry players adapt to changing market dynamics. Covid-19 Impacts The pandemic disrupted global supply chains, leading to shortages of new cars. This scarcity of new vehicles, coupled with production delays, has increased demand for used cars as consumers look for alternative transportation options. The imbalance between supply and demand has, in some cases, driven up prices in the used car market. The economic fallout of the pandemic has led to financial uncertainty for many individuals. As a result, consumers are reevaluating their spending habits and seeking cost-effective options. Used cars, known for their lower prices compared to new ones, have become a more attractive choice for budget-conscious buyers. The overall uncertainty caused by the pandemic has led to market volatility. Fluctuations in consumer demand, economic conditions, and supply chain disruptions have created challenges for dealerships and sellers in predicting and adapting to market conditions. Some consumers, facing financial constraints during the pandemic, may delay maintenance on their existing vehicles or postpone plans to upgrade to a new one. This behavior has influenced the availability of used cars in the market, impacting both sellers and buyers. In various regions, government stimulus packages and incentives to boost economic recovery have included measures related to the automotive industry. Some countries have introduced programs encouraging the purchase of new or used vehicles, offering tax credits or financial assistance. These initiatives aim to stimulate the automotive sector amid economic challenges. Lockdowns and social distancing measures have accelerated the adoption of online platforms for buying and selling used cars. Digital marketplaces and virtual showrooms have become essential tools for dealerships, enabling them to reach customers in a contactless manner. This shift toward online transactions is likely to persist even beyond the pandemic.

Key Development

• By early 2024, Volvo intends to have a third of its volume come from its certified used-car sector, which it will start in September 2022 and spread throughout the country. Volvo uses the 'Selekt' platform, which it just introduced in India with two dealerships, to run its {{keyword}} business worldwide. • In May 2023, CarMax, the omnichannel used-car retailer, announced amplifying its customer outreach initiatives and elevating the overall customer experience by integrating the language models and Azure OpenAI that power ChatGPT. • In June 2023, Jardine Cycle & Carriage Limited, the investment arm of Hong Kong-based Jardine Matheson collaborated with Southeast Asian car marketplace Carro. According to a joint statement by the companies, this collaboration will provide Carro with access to a broader selection of high-quality used cars while enabling Carro to improve Republic Auto's digital services and offerings. The alliance aims to strengthen both companies' positions in the market and enhance their customer experiences.