Rise in the number of value added services offered by used car dealers in Russia, expansion of online companies by offering promotional advertisement of used cars, rise in demand for used cars with increase in average replacement age of used cars, expansion of used cars market with increase in car loan finance services will be the key factors driving growth in Russia Used Car Market.
The report titled “Russia Used Car Market Outlook to 2022 – by Type of Car (Sedans, Crossovers and SUVs, Hatchbacks and Others include Micro Vans and MPVs) by Car Age, by Distribution Channels (Dealers and Online)” by Ken Research suggests a growth at a CAGR of 2.3% in terms of volume sales generated through Russia used car market during the forecast period.
Russia car with a mileage market is in developed stage and has surged owning to the growing number of sales of used car through online distribution channel. Online used car market of Russia is increasing rapidly as three major online companies such as Auto.RU, Avito.RU and CarPrice.RU covers maximum share of online used car market sales. Rise in services offered by used car dealers such as after sale services, proper availability of knowledge and history about used cars through company website, offering various brands of cars in one single roof, and charging of less percentage of commission as compared to other countries used car market. Listing of cars after proper inspection, Car loan finance and insurance services attracts major customers in Russia to purchase used car through dealers. Dealers used car market has the maximum potential to grow in future as there is shift in purchasing behaviour of people in Russia and dealers are providing more value added services to its customers to overcome trust issues of people in Russia.
Online companies requires huge amount of capital investment to increase their market share in future. Online “car with a run” market companies need high amount of funding through various investors to sustain themselves in the market as these companies are charging very low commission on total transaction cost which can barely generate profit for the firm. Online used car companies are totally dependent on funding to make their companies grow and investors are investing huge amount on large companies and this lead to increase in amount of fund allotted to the online used car market companies and it is expected that the allotted fund to online companies would increase in future with increase in the market size of a company.
High average replacement age of cars is a major restriction for Russia used car market. Russia has been suffering from the economic slowdown in the country caused by the decline in crude oil prices during the year 2014-2015 along with various international sanctions were being imposed on Russia which lead to decline in purchasing power of the people and reduction in their per capita income. This leads to increase in average replacement age of cars in Russia and people in Russia highly prefer used cars with low price. Increase in private ownership of cars in Russia has rapidly increased and it is expected that it would further increase in future with increase in replacement age of cars in Russia as more number of people can afford aged cars at less price.
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Related Reports by Ken Research:
https://www.kenresearch.com/automotive-transportation-and-warehousing/automotive-and-automotive-components/indonesia-used-car-report/79410-100.html
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