Salaried professionals drive up sales of pre-owned cars in Q2 of 2024

The demand for pre-owned cars surged in the second quarter of 2024 (April to June) as nearly half (48.5 per cent) of salaried professionals marked career milestones such as promotions and bonuses with car purchases, according to a new report by CARS24, an AutoTech company.

This shift is driven by a rise in disposable incomes, increasing affordability of pre-owned cars, and a desire for enhanced personal mobility. The majority of these purchases were made by employees in metro cities such as Delhi, Mumbai, and Bengaluru.

However, the pre-loved cars’ popularity extends beyond metro cities, with growth seen in non-metro markets. Agra, Coimbatore, Nagpur, and Vadodara are leading the charge as they saw a 25 per cent increase in sales on average per city, highlighting the widespread appeal and demand for personal vehicles and the growing demand for pre-owned cars across the country.

The most popular car models among buyers included the Hyundai Grand i10, Maruti Suzuki Swift, and Baleno. The SUV segment also saw significant growth, with models like the MG Hector and Nissan Magnite gaining popularity. This shift towards SUVs reflects a broader trend, with their market share in the used car segment increasing from 10 per cent to nearly 20 per cent over the past five years.

The second quarter saw a unique trend in car sales driven by cultural events and gifting occasions. Akshaya Tritiya, a day traditionally celebrated for making auspicious purchases, saw a spike in car sales. Additionally, Mother’s Day and Father’s Day contributed to this trend, with over 300 cars sold across the country on these days. This highlights the growing tradition of gifting pre-owned cars to family members, with models like the Swift, i20, and Creta being popular choices.

The report also sheds light on the increasing role of women in the used-car market. Women secured 10 per cent higher loan amounts than men, reflecting their growing economic empowerment and confidence in financial management. Loans disbursed ranged from Rs 93,000 for the Alto K10 to Rs 16 lakh for the TATA Harrier.

In the second quarter of 2024, CARS24 facilitated Rs 328 crore in car loans and handled transactions worth over Rs 1,500 crore as consumers sold their cars to the company. This was attributed to an uptick in seller participation, driven by the desire to upgrade to newer models more frequently. The average ownership cycle has shortened from 8-10 years to 4-6 years, reflecting changing personal needs.

The report also revealed the average age of buyers has dropped from the mid-40s to the early 30s, indicating that younger individuals are increasingly turning to loans to facilitate their purchases.