India's Used Car Market to Hit 10.8 Million Sales by 2030: Report Sales of used cars are expected to grow from 4.6 million units in CY23 to 10.8 million by CY30. Meanwhile, new car sales are also climbing steadily, from 4.1 million units in CY23 to 6.3 million units in CY30.
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India's pre-owned car market has hit a notable milestone, surpassing new car sales with a ratio of 1.3:1 in calendar year 2024 (CY24). This shift underscores a growing consumer preference for affordable and dependable mobility solutions. By 2030, the gap is expected to widen further, with a projected ratio of 1.7:1, meaning that for every 10 new cars sold, 17 used cars will find buyers, according to a recent report by CARS24 and Team-BHP.
Both markets are expanding, but the pre-owned segment's compound annual growth rate (CAGR) of 13 per cent between 2023 and 2030 reveals its meteoric rise. Sales of used cars are expected to grow from 4.6 million units in CY23 to 10.8 million by CY30. Meanwhile, new car sales are also climbing steadily, from 4.1 million units in CY23 to 6.3 million units in CY30.
Market drivers
The pre-owned car segment is buoyed by first-time car buyers (FTBs), who account for 56 per cent of all buyers. Life milestones, such as marriage or growing families, influence 17 per cent of purchases. Additionally, 15 per cent of buyers purchase additional vehicles, signaling the emergence of multi-car households.
Interestingly, the pandemic has reshaped priorities for 12 per cent of buyers, who now prefer personal mobility for safety and convenience over public transport. Another 12 per cent are upgrading from two-wheelers, often driven by career advancements or job benefits, while smaller cars remain a top choice for urban buyers seeking practicality.
The rise of digital platforms has transformed the car-buying experience. Buyers increasingly rely on apps, websites, and social media for research and decision-making. Social media influences 56 per cent of buyers, while YouTube and online reviews attract 53 per cent and 50 per cent of buyers, respectively. Recommendations from family and friends remain crucial, influencing 42 per cent of purchases.
Regional market leaders
Preferences vary significantly across India's regions. In the North, buyers favor affordable and practical models like the Maruti Swift and Hyundai i10. On the other hand, in the Southern regions of the country, buyers show a preference for premium models with advanced features.
The East is dominated by compact cars, such as the Swift, Wagon R, and Alto, whereas the west is dominated by Maruti Swift and Honda City sales.
Maruti Suzuki continues to dominate, holding a 36 per cent share of the pre-owned car market and 40 per cent in new cars, highlighting its universal appeal. Honda holds an 8.4 per cent share in used cars but doesn't feature among the top brands in new car sales. Toyota, on the other hand, commands a 6 per cent share of new car sales while being absent from the top five in the pre-owned segment, reflecting strong demand for its newer models.
Consumer tastes are evolving, with SUVs becoming a clear favorite. Their market share climbed from 12.6 per cent in 2022 to 16.7 per cent in 2024, driven by their spacious designs, versatility, and premium appeal. Hatchbacks, while still popular, saw their share dip from 57 per cent to 53.4 per cent during the same period. Sedans also experienced a slight decline but remain a go-to for buyers seeking a blend of comfort, style, and affordability.
The average selling price (ASP) for used cars has risen steadily across India. By 2024, metro cities recorded an ASP of INR 5,74,478, slightly ahead of non-metros at INR 5,39,192. Rising disposable incomes and a preference for premium vehicles in urban areas are driving this trend. Non-metro buyers, however, continue to seek durable and versatile cars suitable for mixed urban-rural use.
Automatic transmissions are gaining traction in the pre-owned market, with their share rising from 11.8 per cent in 2022 to 14.66 per cent in 2024. Urban traffic congestion and improved fuel efficiency coupled with greater affordability in modern automatic models are major contributors to this shift. Buyers increasingly value the convenience and ease of driving that automatics provide.
