Auto majors line up used-car ventures for India

30 October, 2007

Used car markets are popping up across India, with different players giving the concept a try. Global auto majors are increasingly looking for potential buyers of their vehicles in India’s used car market.

The used car market in the country, which is dominated by Maruti’s TrueValue program, has started to see more participation from the likes of Toyota, Honda, Hyundai, and Ford. While Japanese auto major Toyota is hitting the used car mart with its Toyota You Trust brand, it will have stiff competition from Honda’s Auto Terrace, Hyundai’s Hyundai Advantage and Ford’s Ford Assured.

Toyota’s You Trust venture is expected to be rolled out at leading dealerships across the country in end-October 2007 with the company having identified a handful of dealers who will invest and set up operations for used cars.

Meanwhile, Honda has formed a new team to focus on its used-car program called Auto Terrace. The company’s used-car program, that is currently running in a small way, is expected to be accorded an added focus.

The reason for the increased focus on the used car mart is the exchange offers. According to reports, exchange offers are the primary reason why leading auto majors enter the used-car market. Eyeing a bigger share of the used car market, these major companies are also set to sell pre-owned cars at a profit.

Statistics say that the used-car market stands at a huge one million units. In such a scenario, it has been felt that the auto industry expects the used car industry would grow as fast as the passenger car segment. Estimates are that, out of the 2 lakh units in the organized market, Maruti sells more than 90,000 used cars units through its True Value network. Maruti’s True Value has met with a huge success and acceptance in the market. Now with the entry of Ford Assurance, Hyundai Advantage, along with Honda and Toyota’s ventures, it is likely that the space gets to see some positive competition.