For every new Mercedes, Audi or BMW sold in India, there’s a second-hand luxury car changing hands somewhere in this country.
“A new Skoda Laura costs Rs. 16-17 lakh. A second-hand Mercedes Benz C Class is available at that price. Many prefer the latter,” said Faizal Lakhani, vice-president, pre-owned car business, Shaman Group, a large Mumbai-based automobile dealer.
The best sellers are 3-4-year-old Mercedes Benz C Class, BMW 3 Series and Audi A4, which are available in the Rs. 15-20 lakh price range. “You can get a 2008 model Benz C Class petrol version at Rs. 12 lakh,” he said.
“We sold 1,200 pre-owned Mercedes-Benz cars in 2013, a more than 25% growth over the previous year,” said Eberhard Kern, MD & CEO, Mercedes Benz India.
“People are changing their cars quite fast these days,” an Audi spokesperson said. BMW did not respond to HT’s request for a comment.
Vinay Sanghi, chief of online car sales firm Cartrade, which is connected to 1,200 used car dealers across India, said most luxury car owners change their vehicles in three years, leading to a large supply of these cars in the second hand market.
Cartrade estimates the market for second-hand luxury cars to be about 30,000 units per year — the same as the market for new luxury cars. Most people HT spoke to said this estimate was largely accurate.
“There is huge demand for used luxury cars that we can’t cater to,” said Yatin Chadha, senior V-P, Mahindra First Choice, India’s largest seller of used cars. It recently opened its first showroom exclusively for used luxury cars in Gurgaon.
That demand was met by the unorganised sector. And as the market for luxury cars grows, the used car market is expected to grow in tandem.