The wheels of change rolled across Indian roads in 2023 — the Indian government’s introduction of its own Bharat NCAP ratings put the importance of safety in cars front and centre, which went hand in hand with our road network continuing to expand. Car buyers meanwhile, displayed faster adoption of EVs, we witnessed a surge in demand for SUVs, and affection for pre-loved cars continued to grow. In 2023 we observed numerous trends that serve as a compass, pointing towards the future of a dynamic and ever-changing Indian car market. CARS24, India’s leading AutoTech company has today released its ‘Mileage Report,’ highlighting 2023’s key trends in the car industry. CARS24 continued to dominate with a 42% increase in sales compared to 2022, showcasing its ability to adeptly navigate the ever-evolving currents of the Indian auto market.
Affordability and value, paired with an influx of younger, premium cars, positions used cars as the unequivocal smart choice. In 2023, millennials and Gen Z took the wheel by not just buying, but also upgrading their cars, injecting a wave of younger vehicles into the market and seamlessly addressing the demand-supply gap. According to CARS24 data, the ratio of new cars to used cars in 2023 was 1:1.5 – which means for ten new cars sold, fifteen used cars entered the market. This influx of younger, premium used cars played an important role in fulfilling the car dream for many Indians.
An interesting shift was also observed in the growing preference for higher value cars in the used car market. CARS24’s internal analysis revealed a 14% surge in the sales of cars valued above INR 8 lakhs between 2018 and 2023. This trend was more pronounced in cities like Bengaluru and Hyderabad, where the >8 lakh category experienced substantial growth. This can be intricately linked to rising income levels and a no-compromise attitude on features, quality and safety among consumers. “I am immensely proud that so many individuals have chosen CARS24 to be a part of their families. The exciting trends we are witnessing are nothing short of crazy, and I believe they will shape the future, enabling us to compete globally. With such promising shifts, we are on a trajectory to surpass major markets like the US in the next few years, redefining the used car landscape and solidifying CARS24’s role as a global trendsetter.” added Gajendra Jangid, Co Founder, CARS24
Growing interest in eco-conscious driving: 5X surge in EV enquiries; CNG sales up by 2.6X
In 2023, there was a phenomenal 5X surge in enquiries for Electric Vehicles (EVs) on the platform, reflecting a growing interest in alternative fuel options and a shift towards cost-efficient and eco-conscious driving. With a rising number of individuals exploring EVs—averaging 200 enquiries per day—it was evident that consumers were actively seeking cleaner and greener options. As the EV landscape matured and infrastructure advanced, it was clear that the future of driving was steering towards a more sustainable direction. With more people switching cars every 4-5 years and the rising popularity of electric vehicles (EVs), CARS24 expects used EVs to become available in the market within the next 5 years to meet this growing demand.
The demand for company-fitted CNG cars also skyrocketed with a 2.6X increase for the first time in several years, indicating a unique shift in what consumers are looking for: Cars that are economical to run, with CNG-powered vehicles providing significant savings compared to petrol and diesel alternatives. In cities like Mumbai, where petrol was priced at INR 106.29 a litre and diesel at INR 94.27 a litre, escalating fuel costs steered consumers towards CNG models. Metro cities such as Delhi, Mumbai, Bengaluru, and Chennai witnessed a pronounced preference for CNG cars, reflecting a growing awareness and adoption of economical and eco-friendly transportation choices.
SUVs taking the road by storm in 2023
In 2023, the commanding sales of SUVs continued to soar. Except this time, it wasn’t just a stylistic detour but a calculated move. Families found spacious havens, adventurers discovered their off-road partners, and safety took the wheel. This convergence of practicality, capability, and subtle swagger resonated with a nation on the rise, making SUVs the vehicle of choice for a future filled with boundless possibilities.
This rise can also be attributed to the expanded range of options available at different price points, with top features aligning with the evolving needs of today’s consumers. The SUV-centric trend has extended beyond new cars and is making its presence felt in the used car market with a 4-6% growth since FY21. The standout SUVs dominating Indian roads this year comprised the Brezza, Sonet, Ecosport, XUV300, Taigun, and Tiago.
They say you can know a lot about a city by their SUV preference, Here is the Top SUV pick from cities around the country:
- Delhi-NCR – Creta
- Mumbai – Ertiga
- Bengaluru – Ertiga
- Chennai – Ecosport
- Hyderabad – Brezza
- Kolkata – Ecosport
- Pune – Creta
- Ahmedabad – Brezza
- Indore – WR-V
- Jaipur – Ertiga
- Kochi – Nexon
- Agra – Ertiga
- Lucknow – Creta
- Coimbatore – Triber
- Nashik – Ecosport
- Patna – Creta
- Nagpur – S-Cross
- Chandigarh – Brezza
- Surat – Ecosport
Yes, you read it right. Ecosport is still a very popular SUV in the used car market.
Automatic vs Manual – The game of transmissions
2023 saw an inclination towards automatic cars, especially among individuals aged 30 and above. The convenience of automatic transmissions have become particularly appealing to this age group, aligning with their preferences for a more relaxed driving experience. In high-traffic cities like Bengaluru and Gurgaon, where navigating congested roads can be a daily challenge, the demand for automatic cars soared. The price gap between automatic and manual transmissions has narrowed in recent years, making the former more accessible to a wider range of budget-conscious buyers.
CARS24 recorded a 77% increase in the sale of automatic cars in comparison to 2022. The most preferred models in automatic transmission included: Honda City, Celerio, Kwid, Baleno, Nexon, and Creta
Car buyers amp up budgets by 30% for top-notch features
A shift in preference towards cars equipped with premium features was also witnessed in 2023. Customers across age groups aimed to make a statement with their vehicles, opting for cars that boasted premium elements such as leather interiors, stylish alloy wheels, and ambient lighting. There was an increased demand for turbocharged engines, offering a lively and fuel-efficient driving experience. Safety remained a top priority, leading consumers to prioritise features like multiple airbags, anti-lock braking systems (ABS), and electronic stability control (ESC). Additionally, advanced technologies like the 360-degree camera and sunroof gained popularity, contributing to an enhanced overall driving experience. Ventilated seats, especially valued in cities with hot summers such as Delhi, Jaipur, Ahmedabad, and Mumbai became an essential comfort feature for many. This shift in consumer behaviour reflected a desire for cars that not only provided reliable transportation but also reflected their personalities, where compromises were not on the table.
The average buying budget saw a substantial 30% increase since 2021, highlighting a clear willingness among buyers to invest in quality and premium driving experiences. This dynamic shift positions the used market for an era where customers prioritise both style and substance, creating a new standard in car ownership.
Maruti toh Maruti hai but Kia ne yeh kya kiya?
We can’t talk about cars without mentioning Maruti Suzuki. The timeless icon solidified its position yet again as a driving force in the Indian automobile market. Renowned for its reliability, fuel efficiency, and a wide array of offerings catering to diverse consumer preferences, Maruti remains the top choice for a significant portion of Indian drivers. And hatchbacks such as the Swift, WagonR, Alto, and Baleno continued to be the most popular hatchbacks in 2023 as well.
On the other end of the spectrum, Kia emerged as a powerhouse in the market with a 64% increase in sales, exhibiting phenomenal action and making significant strides in a relatively short span. Kia’s lineup of stylish and feature-rich vehicles, cutting-edge technology, competitive prices, and robust performance is turning it into a popular choice for customers. The most sought after Kia cars in 2023 were the Kia Sonet and Seltos.
More millennials opted for car upgrades in 2023 injecting a fresh wave of younger vehicles into the market
In a very interesting trend last year, the younger generation in India shifted gears towards online car shopping and spent approximately 3 hours on online research and exploration before finalising a car. This digital shift wasn’t a passing fancy but a lasting change. What set it apart was the shorter ownership cycle embraced by these buyers, selling cars within 5-6 years compared to the traditional decade-long norm. Surprisingly, most millennials weren’t just selling but swiftly upgrading to something better. This evolving trend wasn’t just a change in habits; it was a direct result of the steady stream of high-quality, aspirational cars hitting the market. As millennials opted for frequent car upgrades, it reshaped the used car industry, creating a dynamic and balanced marketplace for both sellers and buyers.
Customers seek value beyond cars, willing to invest more for a better car experience
In the past year, a significant trend took shape among Indian consumers. Beyond the basic car purchase, they actively sought additional services and products to enrich their overall ownership experience. The willingness to spend on value-added services (VAS) increased by 37%.
This shift in behaviour revealed a growing preference for comprehensive offerings beyond vehicle acquisition. Whether it was extended warranties, maintenance packages, or cutting-edge tech integrations, buyers sought a broader range of services to complement their car purchases. Customers’ willingness to invest extra in these additional services demonstrated their recognition of the enhanced value and convenience these offerings brought to their overall car ownership. On average, each customer spent an additional INR 9,600 to enhance their ownership journey with these supplementary services.
More loans on used cars than ever before
In 2023, Indians transformed the landscape of car ownership, increasingly turning to car financing as the gateway to realising their automotive aspirations. Cities such as Ahmedabad, Hyderabad, Coimbatore, and Rajkotwitnessed a significant shift, with the convenience of car financing resonating strongly among a burgeoning number of enthusiasts.
The financial journey took an interesting turn as Delhi-NCR emerged as the hotspot for the maximum loans on used cars, reflecting a city-wide embrace of the financing trend. Surat took the lead in number of loan applications, indicating a high demand for financial support in the car-buying process. In Agra, out of 100 car buyers 80+ took financial support. The average EMI on pre-loved cars in 2023 was INR 11,387
The financial spectrum in India varied, with the highest loan hitting INR 21 lakhs, secured by a customer in Noida, while the smallest loan amounted to INR 92,000, granted to a user in Karnal, Haryana.
Tier III cities like Ludhiana, Nashik, and Rohtak experienced a notable surge in loan disbursements, underscoring the widespread adoption of financing options in 2023. 63 out of 100 buyers opted for a used car loan and CARS24 processed around 411 loan applications on a daily basis. In reference to disbursals, the platform reached a peak of 300+ disbursals on a single day on 15th Oct. Practicality took precedence as a majority of Indians opted for a 6-year loan tenure, striking a balance between the excitement of car ownership and manageable monthly payments. Demographically, 73 out of 100 people in the 20-30 year age bracket sought financial assistance, while those in the 60+ age group preferred paying the full amount upon delivery.
Notably, CARS24 recorded a substantial 115% increase in loan applications by women, marking a shift towards increased financial inclusivity in the automotive sector.
Turning Wheels into Wealth: Indians sold cars worth around INR 502 crore every month in 2023
Every month, around INR 502 crores’ worth of used cars hit the market, thanks to savvy Indians who were turning their vehicles into cash. In fact, as per CARS24’s data, the ratio of new cars to used cars in 2023 was 1:1.5 – which meant that for every ten new cars sold, fifteen used cars entered the market, all thanks to people wanting to sell their cars. CARS24 recorded a 20% growth in people selling their cars in 2023 in comparison to 2022.
The maximum cars were sold from New Delhi in metros and Lucknow, Jaipur, Surat, Kochi and Patna in Non Metros.
The most sold car brand was Maruti with the Swift being the most sold model. Maruti was followed by Honda and Hyundai. The cheapest car sold was by a customer in Amreli where they sold their Maruti Zen for INR 6,000 only while a CARS24 customer in Mumbai made INR 1,38,00,000 by selling their Mercedes Benz S Class.
Maximum deals were closed within minutes of car inspection. Saturday was the most popular day of the week for customers selling their car and July the most popular month.
About CARS24
CARS24 is a leading AutoTech company streamlining and revolutionising the sale, purchase, and financing of pre-owned cars in India, Australia, Thailand, and UAE. Leveraging a Smart AI Pricing Engine, and 140 quality checks, selling and buying pre-owned vehicles is seamless and transparent.
CARS24 Financial Services Private Limited, is a professionally managed Non-Banking Financial Company (NBFC) registered with the Reserve Bank of India, offering customer focused value added services.
For regular updates on CARS24, follow us on: https://www.linkedin.com/company/CARS24
