SEA Used Car Market Overview:
The SEA Used Car industry is currently positioned in the early growing stage and is anticipated to register a double digit CAGR between the forecasted period 2021 to 2026F. The customers will tend to switch to used cars and new cars at a rate faster than before, depicting rapid change in consumer preferences. The market structure is expected to be consolidated in the future as the market share of players selling vehicles via organized channel is expected to surge.
SEA Used Car market is currently in the late growing phase, growing at a CAGR of ~% during 2015-2021. Covid-19 pandemic had significantly reduced the purchasing power of consumers across the globe, due to which the ability to buy new car plunged. A quite significant shift in consumer’s preference towards used cars has been observed in the SEA region. Growth of transactional marketplaces offering one-stop solutions to buyers & connecting dealers, financing and insurance companies is also driving the used car market in SEA.
By Business Model (C2B and B2C+C2C): The Overall SEA Used Car market is expected to witness a sales volume of ~ million units through C2B channel in 2021 with a CAGR of ~% during the period 2015-2021. The C2B Platforms enable sellers to sell used cars directly to the online players who in turn sell the inventory to the dealers either through bidding or by general sales process while charging a margin.
Due to the presence of large number of organized and unorganized multi brand dealer in the market selling used cars to customers, B2C sales channel remains as the second most dominant channel after C2B. The advantage of purchasing a used car through a B2C Channel is the service offerings they provide such as aftersales, warranty and financing options among others which is lacking in C2C sales channel.
By Country: Thailand is the Market Leader in Terms of both Sales Value and Volume, reporting ~ million Used Car Transactions in 2021. Malaysia Contributes the Most in terms of Online Used Car Market in the SEA Region as a result of the high Internet Penetration of about ~% at the start of 2022.
Snapshot: Indonesia Used Car Market Analysis:
Overview: The entry of various financing companies in the used car industry, as well as the launch of OEM-certified used car programs, has been the major growth drivers of the industry.
Competition Analysis: The industry in Indonesia is largely unorganized due to the preference of consumers towards standalone local, independent dealers or the ones located in used car exchanges, along with peer-to-peer sales, facilitated by online auto-classified platforms.
Snapshot: Thailand Used Car Market Analysis:
Overview: Increasing demand for private vehicles, reduction in purchasing power, easy availability of finance, and increasing VAT on new cars are the main reasons behind positive growth in used car sales revenue.
Competition: Online market is dominated by Carro and Carsome in the region. Both foreign as well as domestic companies are present in the market. The players compete on parameters such as proximity, value added services, prices, promotional offers and tie ups with major financial institution. In order to increase their revenue, the players offer free gifts and warranty as a part of promotion.
Snapshot: Malaysia Used Car Market:
Overview: Increasing demand for private vehicles, increasing purchasing power, easy availability of finance, increased govt. incentives to ensure sale of new cars are the main reasons behind positive growth in used car sales revenue.
Competition: Some of the players operating in the B2C and C2C online used car segment are – Carsome, MyMotor, MyTukar, MUV and others.
Snapshot: Philippines Used Car Market:
Overview: There are a number of growth drivers which has resulted in expansion of the market; these include a surge in the demand of private cars, increasing per capita income, convenient financing facilities, increased internet penetration and enhanced digitalization of the used cars space.
Competition: Used Car Market in Philippines is highly fragmented as majority of the market is unorganized.
Snapshot: Singapore Used Car Market Analysis:
Overview: There has been an immense expansion in the lead generation of used cars via the online means in the last decade.
Competition: There exists intense competition in the fragmented market.
Snapshot: Vietnam Used Car Market:
Overview: Leveraging the growing internet penetration rate, various online classified players launched their operation in Vietnam post 2013. The increasing preference of consumers towards availing digital medium for their purchases has enhanced the sales prospect via C2C channel through classified platforms.
Competition: Vietnam’s used car market is highly fragmented with presence of large number of organized and unorganized multi brand dealers.
SEA used car market is an extremely fragmented, with many players capturing more than one geography in the region. With several C2B & B2C online players, auto-classified platforms, OEM-certified, brand-authorized dealerships, multi-brand outlets, and independent (standalone as well as clustered) dealers operating in the business, there is fierce competition in the highly fragmented market. Recently, several new players have begun exploring the untapped markets in Southeast Asia. Price, vehicle age and residual value, brand value, and the need for maintenance are some of the most critical aspects influencing consumer preference.
SEA Online Used Car Market:
Increasing internet and smartphone penetration in the Southeast Asian countries has resulted in large number of consumers preferring to buy and sell cars through online auto classifieds and social media, due to which the used car market is getting more organized and gaining more traction. These platforms are taking advantage of digitalization to advertise their listings, making them easier to access and more visually attractive with an enormous number of reviews, photos and videos. Their aim is to harness the untapped potential of the industry as currently, there exists a single digit online penetration for used car in the Southeast Asia region.
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SEA Ancillary Services Market:
Ancillary Services includes, Auto Finance, Car warranty, Motor Insurance Premium and Aftermarket Service. Banking institutions, NBFCs and captive companies are the major entities offering financing facilities to customers willing to purchase used car.
The automotive aftermarket service industry recorded a positive CAGR of ~% on the basis of revenue in between 2015 and 2021. Surging vehicle parcs coupled with fast-growing middle-class population willing to avail private transportation medium due to increased awareness on health and hygiene followed by the advent of COVID-19 are some of the major determinants for the growth of automotive sector in SEA region.
What is the Future of SEA Used car market?
The used car industry in SEA is expected to grow in the future at a double digit CAGR over the forecast period 2021 to 2026F. The industry is expected to establish strong demand arising due to preference of personal vehicles over public transportation as the after effects of the pandemic. Future Technologies involving Artificial Intelligence & Virtual Reality is expected to enhance the digital buying & selling experience for consumers by offering 360° interior & exterior view of the car, estimating car price online via uploaded images, analysing consumer behavioural insights to show relevant ads according to interests & more.
Key Topics Covered in the Report
- Executive Summary
- SEA Used Car Market Future Outlook
- Ecosystem of Major Entities in SEA Used Car Market
- Overview and Genesis of the Used Car Market in SEA Region
- Value Chain Model for Used Car Industry
- Issues and Challenges
- Overall Used Car Market Size and Segmentation
- Online Used Car Market Size and Segmentation
- Ancillary Service Market Analysis
- SWOT Analysis
- Customer Decision Making Parameters for Buying Used Car
- Covid-19 Impact on SEA Used Car Market
- Comparison of SEA Used Car Market with USA and China Market
- Competitive Landscape & Cross Comparison of Major Players
- Company Profiles
- Individual Country Wise Used Car Analysis for Indonesia, Thailand, Malaysia, Philippines, Singapore and Vietnam
- Future Projections
- Analyst Recommendations
- Research Methodology
Ankur Gupta, Head Marketing & Communications