Rise in the number of value added services, inclining number of offline stores and Introduction of new online players will be the key factors driving growth in China Used Vehicle Market.
China used vehicle market has surged with rising penetration of online sales. Online marketplace for used vehicle in China picked with the entry of three major players, Guazi, Uxin group and Renrenche, which account for majority of the sales through this distribution channel. Sale of used vehicle through online platform is expected to increase at a CAGR of 51.7% during the period 2017-2022. Rise in services offered by used vehicle companies such as after sale services, availability of a proper database of used vehicles, financing options and number of tests conducted have attracted the customers towards the online platform. Online used vehicle market represents the maximum potential to grow in future as there is shift in purchasing behaviour of people in China. Online companies are providing different services to overcome trust issues faced by them.
However, in case of used buses and trucks, online channels have a very low penetration. Commercial buyers purchase buses and trucks in bulk from organized dealerships and car markets and are offered good discounts for the same. On the other hand, dealers also provide commercial buyers with after sales services along with permits for all cities, financing and insurance solution.
One of the major reasons behind surging growth of the online segment is the amount of funding received by the players. Low commission rates charged have made online used vehicle companies totally dependent on funding and investors are investing huge amounts on major companies such as Guazi, Uxin, Renrenche and others.
Reduction in average replacement age of vehicle is contributing to the growth as people are getting good quality, well maintained vehicles at lower price with availability of multiple financing options. Demand for used vehicles in China is expected to increase in future with increase in private ownership rate, entry of new players and growing trust of people on the online segment
The report titled “China Used Vehicle Market Outlook to 2022 – by Type of Vehicle (Sedans, SUVs, Micro Vans, MPVs, Trucks, Buses, Cross Type Vehicles, Trailers, Motor Cycles and Low Speed Trucks), by Vehicle Age, by Distribution Channels, by Region, by Price of Vehicle” by Ken Research suggests, market for used vehicles in terms of sales volume, will enhance at a CAGR of 22.8% over the forecast period.
For more information about the report, refer to below link:
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