HomeViews NewsCOVID-19 impact: Young India drives pre-owned car market with extra care

COVID-19 impact: Young India drives pre-owned car market with extra care

As safe mobility becomes the core concern for young India, preowned cars are emerging as the preferred option due to the COVID-19 threat

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By Niraj Singh  July 16, 2020, 5:53:53 PM IST (Published)

COVID-19 impact: Young India drives pre-owned car market with extra care
Owning a car is a perennial aspiration for people depending on personal mobility. While some may fulfill these aspirations by buying a car, others are hampered by cost constraints. But the COVID-19 pandemic has now turned things on their head. Public transport is no longer a safe proposition as the threat of virus transmission looms large.


Since buying a new car is still may be out of reach for most aspirants (more so, when people are not sure of what to expect, even if they could afford a new, they wouldn’t want to spend a lot for a new car), young India has been resorting to the next best stratagem: buying a preowned or used car. With windows generally rolled up to avoid external pollution as well as the threat of airborne coronavirus transmission, people feel relatively safe inside.

Drivers for preowned cars

While the youth may have earlier been dissuaded by their families from buying a car, safety concerns have overwhelmed monetary considerations. Although families could still be reluctant in allowing the purchase of a new car, given the higher costs, buying a preowned car seems more acceptable. This is more so as the family understands that under the new normal of social distancing, public transport is no longer a safe option.

Consequently, in the past few months, the preowned car market has seen a steady rise in demand, particularly for cars in the Rs400,000 to Rs600,000 range. Most first-time buyers are those who previously used cabs or public transport. As the economy moves through the Unlock phase, this trend could accelerate.

Since COVID-19 continues to remain a potent threat, people are cautiously getting back to work while according utmost importance to personal safety. A recent survey by consulting firm Deloitte reflects this wary approach. Whereas 77 percent of respondents wish to curb public transport use, 70 percent will avoid ride-sharing options completely. Significantly, 79 percent of respondents want to own a vehicle.

Undoubtedly, this represents an excellent opportunity for the preowned car industry. A few facts must be borne in mind, however, when it comes to quality parameters because consumers cannot be taken for granted. Understanding consumer trends will help in meeting the norms.

Addressing Consumer Concerns

To begin with, the coronavirus crisis has highlighted the importance of possessing personal transport rather than depending on other means. A personal car ensures anytime, anywhere mobility. Furthermore, some essential statistics should be remembered. For example, 72 percent of preowned cars are purchased by people less than 35 years of age in India. Of these, 68 percent are first-time car buyers. Since barely 30 percent of preowned cars come in good condition, almost 96 percent of buyers are unsatisfied with their preowned car buying experience.

Given this scenario, companies dealing in pre-owned cars must undertake numerous quality and safety checks, besides ensuring the ease of buying for customers. But with lockdown restrictions prevailing in many regions, ensuring smooth buying is easier said than done. To address this core challenge, preowned car companies can consider offering test drives from the customer’s homes. Not having to worry about visiting a preowned car showroom can enhance the ease of doing business for potential purchasers.

At all stages and every touchpoint, the customer should be assured that stringent safety and hygiene protocols have been undertaken. In other words, the online perusal of cars from the current inventory, home test drive, home deliveries and online booking of the finalised car should all be undertaken with care, caution and extra attention to the finest details. The entire focus must remain on zero-contact processes that make customers feel safe and secure despite the COVID-19 threat.

These processes are equally important for the employees and their families – as they need to feel safe to set an example at every transaction with the customer Strict protocols of safety and hygiene are only as relevant as how the field teams are driven to execute.

If customers are assured of safety, reliability and easy buying under the new normal conditions, there is every reason to believe that satisfaction levels regarding preowned cars will soar in the coming days.

—Niraj Singh is CEO & Co-founder, Spinny, an online platform for buying and selling used cars. The views expressed are personal
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