2024 has kickstarted with a bang, presenting the automotive industry with more reasons to celebrate than ever before. Amidst this backdrop of optimism, CARS24, a leading player in India's Autotech landscape, has released its highly anticipated Drivetime Quarterly report, shedding light on the evolving preferences of today's consumers.
The trends this quarter go beyond a mere increase in numbers; they reflect a deeper, more meaningful change in the way people view car ownership.
The first quarter was led by SUV lovers and millennials based out in nooks and corners of the country who saw the value of owning a pre-loved car. The platform recorded an increase in SUV sales coming from non-metro markets. CARS24 also surveyed its customers and found that many expressed their intention to opt for a used car again.
Hamara Desh Badal Raha Hai: 30% Increase in Acceptance for Pre-Loved Cars
In the first quarter of this year, a significant shift in consumer behaviour unfolded across Tier II and Tier III cities. Compared to the same period last year, there was a striking 30% rise in the inclination towards used cars, eclipsing the demand for new ones. This growing acceptance of pre-owned vehicles indicates a changing mindset among buyers, who are now looking beyond brand-new models. Notably, cities like Ahmedabad, Kochi, Jaipur, Surat, Bhopal, Indore, and Lucknow are embracing this trend, viewing cars as more than just transportation but as symbols of style and status. This surge in interest has further fueled the market for pre-owned cars with premium features, marking an exciting evolution in the automotive landscape.
SUVs Steer the Way: Non-Metro Roads Embrace Larger, Premium Rides
On the open roads of non-metro cities, SUVs have emerged as the frontrunners, witnessing a remarkable 40% surge in sales this quarter. This shift underscores a growing preference for larger, more premium vehicles in Tier II and Tier III cities. Driven by the SUVs' versatility, comfort, and advanced features, models like the Ford Ecosport, Hyundai Creta, Tata Nexon, Maruti Suzuki Brezza, and Hyundai Venue are leading the charge. The streets are buzzing with excitement as consumers seek the perfect blend of style and substance in their rides.
Automatic Cars Accelerate: Convenience and Luxury Take Center Stage
Additionally, the quarter saw a significant 30% increase in automatic car sales in non-metro markets, reflecting a shift in consumer preferences towards vehicles offering ease of use and integrated luxury features. This trend highlights a growing demand for cars that seamlessly blend premium aesthetics with cutting-edge technology. Features like sunroofs, CarPlay/Android Auto compatibility, alloy wheels, GPS systems, and rearview cameras have become standard requirements for the modern driver, transforming the driving experience into a seamless and enjoyable journey.
Investing in Experience: Value-Added Services on the Rise
Moreover, investment in value-added services (VAS) has seen a substantial rise of 37%, indicating a trend towards enhancing the overall car ownership experience. With an average additional spend of INR 9,600 on services like extended warranties and tech upgrades, consumers are increasingly seeking cars that offer not just utility but also luxury, comfort, and peace of mind. This shift underscores a broader desire for cars that provide a holistic ownership experience, reflecting the evolving needs and preferences of today's consumers.
Maruti's Still the Heartthrob, But Hyundai and Honda Are Sliding Into the DMs!
Maruti Suzuki keeps winning hearts, with the sleek Swift, the bold Baleno. They're not just cars; they're crushes on wheels. But wait, there's some competition! Hyundai and Honda are not just watching from the sidelines; they're sliding into the DMs with style and designs turning heads, they're whispering sweet nothings to the car lovers, promising a ride filled with thrill. More people also opted for SUVs from these brands than ever before. Creta being the most popular followed by Brezza, CRV and Ertiga. (According to the company's module, station wagons are also part of SUVs.)
Top Questions of the Quarter: Kitna Chali Hai and Maintenance Costs
"Kitna chali hai?" and "Maintenance ka annually kitna kharcha hoga?" have become the catchphrases of the quarter among used car buyers this quarter. These questions reflect a mature and thoughtful approach from buyers, prioritising not just the immediate appeal of the car but also its long-term financial implications. In addition to these, buyers have also been keenly asking, "Is the car's history as clean as it looks?" and "Will owning this car make a good impression?" Another important question is, "How quickly can I complete the purchase and start driving?" These queries not only aim to gauge the car's performance and maintenance expenses but also consider its past, its potential to impress, and the speed of the buying process. This approach shows that buyers are not just excited about getting a new car; they're also carefully considering the costs, reliability, and the overall process involved.
Colour Trends: Matching the Vibes
The palette of automotive preferences is undergoing a notable transformation, as colour choices shift to mirror the evolving tastes and identities of consumers, particularly among Gen Z. Silver has swiftly outpaced the traditional favourite, white, establishing a new benchmark in vehicle aesthetics. This quarter, we've witnessed an embrace of more expressive hues—vibrant reds and cool blues have become popular choices, signalling a departure from the conventional. Additionally, an unexpected contender, earthy brown, has emerged, challenging the dominance of primary colours and illustrating a broader trend towards vehicles that reflect personal style and ethos. It's clear that today's buyers, especially those from the Gen Z demographic, are seeking cars that resonate with their individual vibes and lifestyle, making colour selection an integral part of the purchasing decision.
We wonder if ‘brown munde’ had something to do with ‘brown cars’
Financier dreams: INR 335 Crores of Car Loans Disbursed
Used car financing has now turned into a nationwide movement underscoring a rising quest for financial independence and turning car ownership aspirations into reality. In a mere 90 days, loans worth INR 335 crores were disbursed thanks to a user-friendly financing approach that bypasses traditional down payments, simplifying vehicle ownership. This model particularly resonates with first-time buyers, indicating a significant lean towards more accessible car purchasing avenues. The demographic tilt towards a millennial majority seeking to boost their mobility reflects a deliberate pursuit of personal transport solutions.
Furthermore, this trend isn't confined to India's urban centres; about 30% of loan applicants this quarter came from Tier 2 and Tier 3 cities, demonstrating the widening influence of car financing as a vital tool for vehicle acquisition in more rural areas. The Grand i10 stands out as the preferred choice, highlighting a nationwide consensus across various regions. The average EMI on pre-loved cars in Q1 2024 was INR 10,200.
The loan process's efficiency, capable of securing approvals in as little as six hours, mirrors the advancements in financial services and meets the instant needs of contemporary buyers. Moreover, 20% of all the loans disbursed were taken by women signalling a shift from car financing's traditionally male-centric audience. This change reflects the growing financial autonomy of women and their enhanced role in the economy, promoting gender equity in traditionally male-dominated sectors. These financing avenues empower more women to take control of their car ownership decisions, changing the landscape of economic empowerment and societal norms in India.
People sold their Cars worth INR 1385 Crores to CARS24
In the first quarter of 2024, Indians embraced the opportunity to sell their cars to CARS24, resulting in a collective amount of INR 1385 crore in transactions. This period marked a significant uptick in seller participation, indicating a vibrant and active market. What's noteworthy is how customers actively contributed to addressing the demand-supply gap by introducing newer cars into circulation. This influx of younger vehicles also broadened the array of options available to potential buyers in the pre-owned car market. With younger cars finding eager buyers within minutes of being listed, the market experienced a newfound dynamism, reflecting the evolving preferences and behaviours of consumers across the country.
Fun Insight - Remember the Maruti Zen
That tiny titan claimed the title of "Budget King" in the pre-owned car realm. On the 8th of February 2024, someone in Nagpur, Maharashtra, snagged this compact cruiser for a steal- INR 1,15,000. But before the deal was sealed, more than 200 people were eyeing this sweet deal.
Gajendra Jangid, Co-founder of CARS24, expressed "This quarter has seen our platform come alive, with a remarkable pace of 6 cars being purchased every hour. The trend towards used cars is stronger than ever, transforming the entire auto scene. It's not just tweaking the rules; it's rewriting them in real-time. This isn't a blip on the radar; it's a seismic wave of change. Old habits are out, new trends are in, and we're all players in this epic transformation."
About CARS24
CARS24 is a leading AutoTech company streamlining and revolutionising the sale, purchase, and financing of pre-owned cars in India, Australia, Thailand, and UAE. Leveraging a Smart AI Pricing Engine, and 140 quality checks, selling and buying pre-owned vehicles is seamless and transparent.
CARS24 Financial Services Private Limited, is a professionally managed Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India, offering customer focused value added services.
For regular updates on CARS24, follow us on: https://www.linkedin.com/company/CARS24
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