Demand For Used Luxury Cars Increasing In Tier 2 and Tier 3 Cities: Spinny Max

Spinny Max is an online retail platform for buying and selling used luxury cars and Parag Raheja, Vice President, Spinny Max, says that the demand for used luxury cars is increasing at an steady rate in tier 2 and tier 3 cities. Given below are excerpts from carandbike’s interview with Raheja, who heads the used luxury car business at Spinny Max. The interview gives us insight into the increase in demand for used luxury cars in the not so big cities of India. 

carandbike: Could you tell us about the size of the pre-owned luxury cars in the overall used car market space?

Parag Raheja: The Indian used car market was valued at USD 32.14 billion in 2021, and it is expected to reach USD 74.70 billion in 2027, registering a CAGR of 15.1% during the forecast period (2022-2027), as per  report by Mordor Intelligence. Within this space, the pre-owned luxury cars market is growing faster than non - luxury space. This increase can be attributed to rising aspirations of buyers coupled with better solutions being made available to them. This includes easy access to financing options, increased assortment & models availability and increasing transparency of the transactions.

Pre-owned luxury cars are also seen as better value for money as they allow buyers to enter the luxury segment at a much more reasonable price than a new luxury car. In addition, used luxury vehicles on the pre-owned market tend to have a lower average age compared to mid-size or small-scale vehicles, making them a viable option. The luxury used car market previously saw traction only from metropolises, but now buyers from smaller cities are also buying these vehicles. The rise in demand is due to consumers' preference for luxury cars and the country's youth's inclination toward the top brands.

carandbike: Which are the more popular used luxury car models in India?

Parag Raheja: With the used luxury car market getting more transparent & organised, consumers are fulfilling their dreams of owning a luxury car in a confident & joyous way. According to the Spinny Max Q3 report, Audi, BMW & Mercedes lead the chart in terms of preferred brands. With reference to the car models, Audi Q3, Mercedes-Benz C-Class & BMW 3 series remain the top favourite among the consumers.

carandbike: Has the luxury used car market seen an upward trend post the pandemic?

Parag Raheja: Due to the pandemic, consumers prioritised personal mobility based on safety & hygiene considerations. Although COVID cases have receded over the past few months, the demand for used cars has seen an uptick.

In countries like India, where the disposable incomes of upper middle-class people have grown over the years, professionals aged 30-40 are starting to aspire to buy luxury cars much earlier in life. As a result, we see a surge in demand for used luxury cars in metro cities. Used luxury car sales in metro cities are primarily driven by metro cities. Interestingly, even tier 2 and 3 cities are now experiencing substantial traction in this segment as well with the rise of organised and trustworthy retail platforms that offer premium experience and services such as pan-India home delivery. In the coming years, we expect the trend to grow.