The used car market provides consumers with pre-owned vehicles at affordable prices making them attractive alternative to new vehicles. Used vehicles come with lower initial costs, established maintenance history and warranty. Further, the pre-owned vehicles enable consumers to own high-end models at competitive prices. The rising living standards, growing urbanization and increasing disposable incomes have amplified consumer demand for personal mobility, thus driving sales of used cars globally.
The Global used car market is estimated to be valued at US$ 2.73 Tn in 2024 and is expected to exhibit a CAGR of 0.063% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the Used Car Market Demand are Arnold Clark Automobiles Ltd., Asbury Automotive Group Inc., AutoNation Inc., Autotrader, AutoScout24, Universal Motor Agencies, CarMax Inc., Carvana, Cox Automotive Inc. (Autotrader), Emil Frey AG, Group 1 Automotive Inc., Inchcape Group, Lithia Motors Inc., CarMax Business Service LLC, Asbury Automotive Group, AutoNation Inc., eBay Inc., Big Boy toyz, VROOM, Others. These players are focusing on strategic collaborations and mergers & acquisitions to expand their market share.
The key opportunities in the used car market include rising demand for pre-owned luxury vehicles in developing countries and advancement of online used car sales platforms. The growing middle class populations in Asia Pacific and Latin America have added tremendous potential for used luxury car sales in these regions. Several used car companies are actively working to capitalize on these opportunities through global expansion of their operations.
The increasing penetration of internet and mobile technologies has enabled several used car retailers and third party platforms to sell used cars online. This provides buyers and sellers with convenience of browsing and selecting their preferred used vehicles from the comfort of their homes. Many leading used car players are investing in advanced digital technologies to enhance their e-commerce capabilities and facilitate online transactions globally.
Market Drivers
Lower costs of used vehicles as compared to new vehicles is a major driver driving sales of pre-owned automobiles. Further, the well-established maintenance history and warranty support provided by several dealers have made used cars a reliable alternative.
Market Restraints
Perceived issues regarding the quality and performance of pre-owned vehicles act as a restraint. Moreover, lack of standard inspection and certification processes in some markets creates uncertainty regarding the actual conditions of used cars. This poses challenges for builders.
Segment Analysis
The used car market can be segmented based on vehicle type into compact, mid-sized, SUVs, luxury, and sports cars. The compact car segment dominates the used car market, accounting for over 30% share. Compact cars are affordable and offer good fuel efficiency, making them a popular choice for daily commuting among consumers with smaller budgets.
Global Analysis
Regionally, North America dominates the used car market, accounting for over 35% share currently. The large presence of millennials and strong focus towards pre-owned luxury vehicles are major factors driving the market in the region. The Asia Pacific region is expected to witness the fastest growth during the forecast period. Factors such as rapid urbanization, rising disposable incomes, and changing mobility trends are anticipated to boost sales of used vehicles in the emerging economies of China and India. Other key regions in the used car market include Europe and Latin America.
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