The pre-owned vehicle sector is poised for remarkable growth in the coming years, and hence we can see the automotive industry undergoing significant transformation. SAMIL has first-hand experience of how consumer preferences, technological advancements, and sustainability trends are changing the pre-owned automobile sector. Although India’s Pre-owned Automobile Industry is still at a nascent stage, it has become equal to the new one if not bigger than that. According to several predictions and prophecies, 1.2 pre-owned cars are being sold against 1 new car sold in India:

Similarly, all other vehicle segments also have become equal to new market in volume. The importance of the pre-owned vehicles market is indeed increasing in the broader mobility sector.

What Factors Are Driving Growth?

The robust growth of the pre-owned vehicle market in India is the by-product of various contributing factors such as:

• Emergence of organized players: The presence of efficient and structured platforms like Shriram Automall India Limited has significantly improved transparency, and credibility of the pre-owned vehicle sector. Platforms like these provide reliable transactions, proper documentation, and a more professional buying experience.
• Shorter vehicle replacement cycle: The vehicle replacement cycle has shortened significantly, leading to a higher turnover in the pre-owned car market, as shown below:



• Easier financing alternatives: Banks and Non-banking Financial Companies (NBFCs) are offering attractive loan schemes and lower interest rates for used vehicles, hence making ownership more accessible. Earlier the options were limited, but now, with competitive loan options, buyers can easily get the required financing.
• Affordability and cost-effectiveness: Not everyone can afford a new vehicle, hence making it a non-viable option, especially with rising inflation and increasing vehicle prices. Pre-owned vehicles offer a budget-friendly alternative, allowing people to own a vehicle without the burden of high costs.
• Post-pandemic shift: The shift towards personal mobility post-pandemic is clearly depicted in the chart below:



• Increasing trend of online buying experience: There is a surge in preference for online transactions which has truly transformed the way people buy and sell pre-owned vehicles. Shriram Automall's diverse digital solutions, including Cartardeexchange.com, Bids.samil.in, BidLive via the MySamil App, Desktop Live Bidding, SMS Bidding, and collaborations with classified platforms, have made it easier for customers to purchase used vehicles at their convenience.

Challenges and Opportunities

Using various opportunities to our advantage and continuing to work despite all the challenges will ensure sustained growth.

Emerging Pre-owned Commercial Vehicle Sector

With the increased demand for cost-effective mobility, the pre-owned commercial vehicle sector is also set for a surge. ICRA expects the domestic CV industry’s sharp upcycle to plateau with a marginal decline of 4-7% in volumes. Following a period of stagnation, the industry is set for a gradual rebound, with a 3-5% year-on-year growth in wholesale volumes for FY2025-26. This anticipated recovery follows a stable volume trend in the last financial year, primarily driven by a demand slowdown in the first half due to the general elections.

Let us look at the key trends shaping this flourishing sector:

• Digitalization: Online platforms are successfully streamlining buying, selling, and financing. One such platform is Shriram Automall providing a phygital platform for efficient and transparent bidding for pre-owned commercial vehicles.
• Focus on Sustainability: Demand for used fuel-efficient and electric commercial vehicles is on the rise since people are moving towards a sustainable future.
• Optimization of Fleet: For better cost-efficiency, businesses are balancing new and used commercial vehicle investments for cost-savings.

As the evolution of supply chains continues, pre-owned commercial vehicles will play a crucial role in meeting industry demands while also keeping the costs in check.

What Lies Ahead?

Driven by evolving consumer behaviour, digital innovation, and sustainability, India’s pre-owned vehicle market is on the path of sustained growth. There would possibly be an estimated growth in the pre-owned automotive industry of 15-20% in the next five years. The industry, however, must continue to focus on transparency, technological integration, and adapting to the needs of modern buyers, to fully unlock its potential.