Italy Used Car Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Italy Used Car Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Italy Used Car Market was valued at USD 60 Billion in 2021 and is projected to grow at USD 100.63 Billion by 2027, registering a CAGR of 9% in terms of revenue during the forecast period (2022-2027).

The outbreak of COVID-19 affected the automotive industry significantly. With supply chain disruption and transportation halt, new additions to the used car inventory were not coming into the market. This reduced the number of models available for purchase, influencing the overall purchases. However, during the later stages of 2021, the market started reverting to the pre-pandemic situation, increasing opportunities for the used car market across the country with a major push from low and mid-income consumers.

The growing demand for luxury cars, shorter car ownership periods, booming import-export, and a growing preference for two-wheeler owners to upgrade to small and compact cars are expected to drive demand in the market.

Further, growing trend of digitization across the country is likely to influence positively the sales of used cars during forecast period. Moreover, factors such as surge in the demand for younger used cars, easy availability of financing options, acceptance of electric and hybrid used cars and others expected to offer new opportunities for players operating in Italian market over coming years.

Key Market TrendsStrengthening of online Infrastructure Likely to Have Positive Impact on the Market

With growing smartphone and internet penetration across the country, the used car market is getting more organized, and with the growing proliferation of the internet and smartphones used car retailers are focusing on using digitalization to make their market offerings attractive. For instance, In 2021, the number of internet users is around 54% of the country's population. It will go more than 70% of the Italian population will use a smartphone by 2025.

Facilities such as an enormous number of photos and videos on the online platform and easy online instant finance service are expected to attract more customers to buying used cars. Further, the presence of online used car platforms in the country and their active engagement strategies to drive demand in the market. Some of the major companies in Italy's online used car market include True Car, Autoscout24, Bakeca.it, Alvolante.it, Autorola Marketplace, Cargurus, and others.

Several players across the country are offering end-to-end transactions, doorstep delivery, digitalized recommendations on the basis of driving behavior and lifestyle of the customer, and digitalized test drives are attracting consumers toward the used car. For instance, In January 2022, Cazoo announced its plans of expansion into Europe by snapping up Italian digital car retailer and subscription platform Brumbrum.The online used car retailer said it would be paying EUR 80 million for it using cash and Cazoo shares, as part of deal.

Such developments and active instances with respect to used car dealers and operators, especially online players, coupled with growing digitalization are anticipated to poise notable demand in the market.

Rising Trend of Digitalization to Enhance the Growth of Market

Rapid digitization across the used car industry is expected to have a profound impact on sales of used cars across the country. Rising integration of advanced digital technologies in the buying process coupled with growing investments in a variety of consumer-focused digital technologies such as virtual reality, technologies focused on increasing user engagement on the shop floor, etc. expected to enhance demand in the market during the forecast period.

Several Startups are introducing digital used car business models such as Online car retailers, Aggregators, Big boy arena, and many other platforms which allow the user to buy a used car from a comprehensive product portfolio across these platforms. Major aggregators use online platforms to facilitate wholesalers, and dealers to list their offerings in one place. Notable used car platforms such as Auto1 group are entering partnerships, etc. to gain a competitive edge in the market. For instance,

• In June 2021, Auto1 has entered the Italian market through its consumer-focused Auto Hero product. Auto Hero is a marketplace that offers a wide selection of used cars, which can be ordered online. The purchase process begins with a virtual visit to the online showroom, where consumers can choose their used car.

Further, with the introduction of automated systems that include LCD touch screens, bar codes, and RFID in customer data, auto dealerships expected to improve their business efficiency by enhancing their customer relationship and retention levels across the country.

Competitive Landscape

Italy Used Car Market is a moderately consolidated one owing to the presence of several key players such as Penske Car, Carvago, Auto1.com, CAVAUTO Group, Italy Blue Auto Sales LLC, and many others. Further expansion of car dealers and key players strategies like partnerships, fleet expansions, etc. to support demand in the market. For instance,

• In January 2022, Cazoo, one of Europe’s leading online car retailers, acquired an Italian online used car retailer and subscription platform Brum Brum for 80 million euros. Through this acquisition, Cazoo will launch its service across Italy.
• In November 2021, Carvago expanded its facility across Italy. The company offers 700 used cars to customers across the country.
• In July 2021, RCI Bank and Services, the Renault Group's automotive captive, acquired Bipi, a multi-brand platform that is a reference in car subscription offers for used vehicles. Bipi is present in Spain, France, and Italy.

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