You are here: Home » Companies » News
Business Standard

Mahindra First Choice embarks on expansion, plans to add 30 outlets soon

Company's June volumes to reach 80% of pre-Covid levels, firm plans to have 1,250 dealers by FY21-end as it eyes overall sales of 200,000 units by FY21

Used car market | Used car portal | used cars

Shally Seth Mohile  |  Mumbai 

Covid-19 lockdown: Labour, stockpile make carmakers delay production
MFCW will be ending the current month with 10,000 to 11,000 cars as compared the average monthly sales of 15000 it was doing before the lockdown

First Choice Wheels (MFCW) is embarking on an aggressive expansion plan to tap into the burgeoning demand for The pre-owned vehicles arm of the Group plans to add 30 outlets in a few days taking the total number to 1,000, a top company official told Business Standard.

Even as the market for new cars remains depressed amid the economic fall out of the pandemic, that for pre-owned vehicles is seeing a strong recovery. As a result, the market is expected to reach 80 per cent of what it was in February (a month before the lockdown) in volume terms, said Ashutosh Pandey, chief executive, MFCW.

ALSO READ: RBI to do buy-sell OMO of Rs 10,000 cr keeping in mind liquidity in banks

“Four to five weeks back we conducted a research that clearly showed that personal mobility will be given preference over public transport and given the current economic situation, new entry level cars and will be in great demand, said Pandey adding that it’s an “inflection point” for the used car business.

MFCW will be ending the current month with 10,000 to 11,000 cars as compared the average monthly sales of 15000 it was doing before the lockdown. The company could have done more but for the supply issues. “There is lot of demand, but supply is an issue,” said Pandey citing an instance of states like Bihar where the company has been finding it tough to meet demand.

Despite the current limitations including many areas being in the containment zone, MFCW expects to sell close 200,000 vehicles by the end of this fiscal, same as last year. Pandey said the overall will end the year with a dip—3.8 to 3.9 million units in FY21 as compared to 4.2 million units in FY20. This is in sharp contrast to new car market which is expected to end the year with a sharp year-on-year contraction.

ALSO READ: Digital sovereignty: Trai bats for local manufacturing of telecom equipment

Rating agency Crisil expects passenger vehicles (PVs) sales volume (including exports) to plunge by 22-25 per cent this fiscal to a decadal low of 2.65 million units. That would mark the second straight year of double-digit volume decline after the 15 per cent fall seen in fiscal 2020, it said in a release earlier this month.

To be sure, most of the other in the organized space – be it second hand outlets of car such as True Value or car aggregator platforms like Droom, Carz24 or classifieds like Olx, everyone is looking to tap into the strong growth momentum in the

ALSO READ: Return donations to PM-CARES fund from Chinese firms: Amarinder to Centre

Mahindra’s Pandey said while traditionally, tier two and three markets have been a big draw for pre-owned vehicles, this time around top cities too are showing traction as buyers re-prioritise their expenses amid salary cuts and lay-offs. With disposable incomes coming down one has also seen a down-trading trend, he added.

First Published: Mon, June 29 2020. 17:50 IST