Covid-19, Digital Stores Turned Buyers Towards Pre-Owned Luxury Cars: Boys and Machines

The pandemic has influenced us by having been a key player in making us realize – nothing is permanent! From conglomerates figuring a way to operate remotely to the style of doing business, everything has changed. Covid has led us to explore beyond traditional boundaries and innovate business solutions to make things smoother and more efficient. The start-up frenzy was hungry to solve problems the pandemic showed to the world. Many new businesses have actually grown leaps and bounds during the pandemic.

Talking of the pre-owned car market, it made significant turns and explored new paths after the pandemic. We started after the first wave of pandemic and have been cruising since, now in the midst of the third wave. After the government pressed red on public transport and the nation halted for two months, people realized the importance of personal transport. The safety and convenience one can avail. Not only this but also for a much-needed break from all the chaos and boredom through a drive around. The importance of personal mobility was more than ever.

The consumer trends show us that the pandemic propelled an upward trend in luxury goods sales. The logical reason was the pandemic made people realize that the present is more important than the future. No one knows what happens next. The concept drove people to splurge on themselves in the present by buying luxuries. We have experience starting a business in pandemic first-hand. Though, when we started in October 2020 we thought that pandemic will end soon but that was not the case.

Buying a used luxury car is much more affordable with low depreciation. A new car depreciates around 30 per cent after the first year. Whereas, in the case of pre-owned luxury cars depreciation is comparatively low. With more established players in the market, trust is perceived among consumers which is a big plus. In the pre-owned segment, high quality at the right price is the deal maker.

A recent hike in new passenger vehicles prices due to rising input costs and long waiting periods due to the ongoing semiconductor chip shortage have led consumers to tap on the pre-owned cars segment, increasing demand multi-fold. According to analysts, the chip issue is likely to continue till 2023.

Changes in government policies, including the life-span of diesel cars till 10 years and 15 years for petrol-fuelled powertrains, has increased the demand for petrol cars. The pre-owned market can soon see a lot of EVs in coming years with OEMs pumping EV manufacturing with the support of government schemes supporting electrification. Luxury carmakers are committed to electrifying their line-up in the next 10 years with major steps already taken in that direction. For India, we can expect a phase-wise switch with reinforced infrastructure and manufacturing capability.

The players in the pre-owned cars market are making integral efforts in revamping the customer buying experience with digital aids and door-step delivery at a click of a button. Thorough maintenance checking ensures high-quality cars to customers which was a much sought-after problem. Most of the trusted dealers offer a dedicated service centre for luxury cars that bumps up the overall running quality and longer life.

The pandemic lockdown directed the luxury pre-owned car market to explore new paths. Dealers have developed the digital route to reach more customers. Now, customers can explore the catalogue and virtually experience the car with all the information upfront. This improves transparency and builds trust. Customers have an option to show interest and get a call back for further details or directly proceed to place an order. The digital medium has also helped with more sales conversion. Digital mediums create a platform for hassle-free ownership transfer. With the digital presence, the whole process of buying and selling pre-owned cars have benefited by saving time, expanding customer reach, and improving transparency.

This article is authored by Siddharth Chaturvedi, Founder and MD, Boys and Machines. All views expressed are personal.

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