The Global Used Car Market Primed for Growth Driven by Affordability
The used car market offers pre-owned vehicles at lower prices compared to new vehicles, making car ownership affordable for cost-conscious consumers. Used vehicles come with an established maintenance history and require fewer spendings overall compared to new vehicles. The growing need for affordable mobility solutions is a key factor propelling growth in the used car market.
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 Size 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. The growing demand for affordable personal mobility solutions is propelling growth in the used car market. Various regions worldwide are witnessing increasing vehicle parc which is translating to heightened demand for used vehicles. Leading market players are expanding globally to tap into new markets presenting lucrative opportunities.
Market drivers
Availability of affordable finance and lending options is a key factor fueling demand in the used car market. Various banks and non-banking financial institutions offer auto loans at competitive interest rates making car purchases viable for median-income households as well. This along with availability of multi-brand used car platforms online is boosting commercialization of used vehicles.
Impact of geopolitical situation on the growth of Used Car Market
The used car market is facing challenges due to geopolitical tensions around the world. Supply chain disruptions caused by the Russia-Ukraine conflict have impacted vehicle production globally. Countries are imposing sanctions on Russia, creating hurdles in procurement of raw materials. Moreover, lockdowns in China due to its zero-COVID policy are further affecting automobile manufacturing. As new vehicle production gets hampered, demand for used cars is rising in the short-term to fulfil mobility needs. However, rising inflation and worsening economic conditions in many countries have started impacting consumer spending power negatively. Higher fuel and financing costs are putting pressure on buyers' budgets. While demand is currently robust, a recession may weaken it going forward. To sustain growth, used car dealers will need to focus on expanding supply through innovative sourcing models and improving financing options for customers. Brands also require strategic geographic diversification of their supply chains to reduce dependence on troubled regions.
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