Covid-19 effect: Significant increase in demand for second hand cars in the country

Mumbai, May 26, 2020, Tuesday

As lockdowns are being phased out across the country, the use of private vehicles using public transport to reach their destinations is on the rise. The increasing use of private vehicles has also increased the demand for cars, especially secondhand cars.

Demand for second-hand cars is unprecedented. Inquiries for second-hand cars have almost doubled during the lockdown period compared to the time before the lockdown, according to a survey of about 100 dealers and car buyers.

Demand for used cars at dealers has been strong in the last few weeks, and is expected to grow as the lockdown eases.

Consumers are increasingly interested in buying second-hand cars, especially smaller ones, due to lower income levels and health-related safety, said an organized second-hand car dealer. Inquiries for a particular vehicle, which used to be around 15 per cent before the lockdown, have now doubled to 5 per cent. Inquiries for new vehicles have fallen from 21 per cent to 5 per cent in the same period, the survey further said.

"Once the lockdown is fully open, I would prefer to buy a second-hand car," said 60 per cent of those surveyed. The survey also found that 2.50 per cent of those who planned to buy a new car last year are now turning to buying an old or used car.

This reshuffle is being witnessed as the budget is declining due to the economic impact of Kovid-12. In the financial year 2015-16, the used car market in India was around 3 lakh vehicles, while the market size of new cars was 2.50 lakh vehicles during the period.

The market size of the new car is unlikely to decline in the current year due to the impact of the Corona. Demand for cars worth more than Rs 7 lakh is declining while demand for cars worth around Rs 5 lakh is on the rise, the survey said.