The used car market in India is booming, and it’s only going to get bigger. According to a recent report by CARS24, the market is projected to grow from 4.6 million sales in 2023 to a staggering 10.8 million by 2030, marking an impressive compound annual growth rate (CAGR) of 13%. With rising interest in affordable and dependable car options, used cars are taking the Indian automotive market by storm. Here’s a look at the key trends shaping this surge.
Record Year for Used Car Sales in 2024
2024 has marked a pivotal year for the used car market. In an exciting turn, used car sales have outpaced new car sales for the first time, with a remarkable ratio of 1.3:1. This shift highlights the growing demand for pre-owned vehicles, with buyers opting for affordability over the rising costs of new cars.
Eco-Conscious Consumers Driving Demand for Used EVs
The trend towards eco-consciousness has also fueled the used car market, particularly for electric vehicles (EVs). Sales of used EVs skyrocketed by five times in 2024, especially in major Indian cities like Maharashtra, Karnataka, and Delhi. As more people opt for greener, budget-friendly alternatives, the demand for used EVs is expected to continue to rise in the coming years.
SUVs Continue to Lead the Charge in Used Car Sales
SUVs have remained a dominant force in the used car market, claiming a 16.7% market share in 2024. This growth is largely attributed to consumers' preference for larger, more comfortable vehicles. As SUVs continue to dominate, buyers are choosing pre-owned options, often at a fraction of the price of new models, without compromising on quality.
Rising Prices but Used Cars Still Offer Great Value
While new car prices have surged by 32% in recent years, used cars have experienced a more modest 24% increase in their average selling price (ASP). Despite this rise in prices, used cars continue to offer unmatched value for money, making them an attractive choice for buyers looking for affordability in today’s economic climate.
Gajendra Jangid, Co-founder of CARS24, commented, "The once niche pre-owned car market has taken by storm and redefined car ownership in India. As customer preferences shift towards more affordable and dependable options, the used-car market is witnessing a significant uptick compared to the new car market."
The growth of financing options for used cars is another major factor contributing to this shift. The used car financing market has grown from 15% to 23% between 2010 and 2024, making it easier for buyers to afford quality pre-owned vehicles.