COVID-19 expected to fuel used car sales

COVID-19 expected to fuel used car sales

May 14, 2020

‘With social distancing in place, more people plan switching to private transport’

Physical distancing norms and the fear of catching COVID-19 infection in public transport is likely to give an impetus to personal mobility which was, of late, discouraged to curb pollution and save resources.

This transition is expected to benefit auto companies and used car dealers, who were impacted by the rise of taxi aggregators and metro rail across the country.

“The COVID-19 pandemic has brought about a significant change in the perspective regarding transportation usage in the minds of consumers. Due to the impact of COVID-19 and the implication of strict physical distancing norms, we anticipate that there will be a considerable decrease in the use of public transport and shared mobility,” said Vivek Srivatsa, head, Marketing, Passenger Vehicle Business Unit (PVBU), Tata Motors.

“The demand for personal mobility will increase due to the customer’s need to ensure personal safety,” he added. He said although digital sales had taken a front seat during the pandemic, the online model would not entirely replace the traditional model of purchasing.

Jatin Ahuja, founder & CEO, Big Boy Toyz, a pre-owned luxury car dealer said, “After the lockdown, since hygiene will have a larger role to play, consumers will be opting for personal vehicles over public transports, thus leading to an increase in sale of cars/ two wheelers.”

“Thus, this will have a positive effect on the sale of cars ranging from ₹3 lakh to ₹20 lakh,” he said.

According to a recent survey by CARS24, an auto-tech start-up, a considerable number of the commuters will now look forward to private cars in the post-COVID-19 world to maintain social distancing, but affordability and convenience of public transport will keep attracting daily commuters.

As per the survey, 46% respondents said that they have decreased their budget due to the global pandemic.

Among them, 50% said that they will be purchasing pre-owned cars once the lockdown is over.

Over 22% of the consumers who were planning to buy a new car last year said they would now prefer to buy a pre-owned car because of their limited budget.

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