The Indian used car market is poised to reach the USD 100 billion milestone within the next decade, driven by increasing disposable incomes and a burgeoning middle class, according to Vikram Chopra, Co-Founder and CEO of CARS24.
Citing insights from the Gurugram-based online used car marketplace, Chopra highlighted shifting market dynamics, with consumers increasingly opting for more frequent car upgrades.
“Our internal analysis indicates that the Indian used car market is projected to grow at a 15 per cent Compound Annual Growth Rate (CAGR), rising from USD 25 billion in 2023 to USD 100 billion by 2034,” Chopra shared with PTI.
This growth trajectory is fueled by factors unique to India, such as urbanization and the expanding middle class, which are reshaping consumer preferences and driving demand for affordable mobility solutions.
Chopra reflected on the evolution of the market, noting that when CARS24 commenced its operations eight years ago, the used car market was valued at around USD 10-15 billion. However, with the emergence of various car models in recent years, the market has experienced significant acceleration.
Despite this growth, car ownership in India remains low compared to developed countries. While countries like the US, China, and Europe boast car ownership rates of 80-90 per cent, only around 8 per cent of India’s population owns a four-wheeler, indicating significant potential for expansion.
Another notable trend is the decreasing ownership cycle, particularly among younger generations, who are selling their cars within 5-6 years of purchase, in contrast to the longer ownership periods observed two decades ago.
“The rising demand for feature-rich SUVs has been particularly notable, with a significant increase from 30 per cent in FY19 to 59 per cent in the first half of FY24,” Chopra remarked.
This SUV-focused trend extends beyond new car purchases and is increasingly evident in the used car market, with a steady growth rate observed since FY21.
Furthermore, there has been a surge in sales of cars valued above Rs 8 lakh between 2018 and 2023, reflecting increasing income levels and a burgeoning middle class.
While metropolitan areas currently dominate the supply of pre-owned cars, there is a growing preference for used cars in non-metro cities, with demand expected to grow at a rate of 30 per cent CAGR by FY27.
Chopra also anticipates the availability of used electric vehicles in the market within the next five years to cater to the growing demand for sustainable transportation solutions.
