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

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

United States Used Car Market was valued at USD 195.84 billion in 2021, and it is projected to reach USD 302.47 billion by 2027, registering a CAGR of 7.51% over the forecast period.

The outbreak of the COVID-19 pandemic has caused significant disruption in the automotive industry. Consumers are likely to choose private transportation in the wake of the pandemic. However, financial discrepancies are likely to obstruct the buying of new vehicles, and commuters are expected to opt for secondhand cars due to economic concerns. Furthermore, during this pandemic period, virtual reality, online, or digitally generated sales leads purchase new autos.

Since the pricing competition among new market players and the unavailability of a substantial share of customers to purchase a new car, the market for used cars has grown significantly in recent years. Furthermore, industry participants in the used vehicle market are strengthening their dealership network through investment in various states in order to capture a large number of customers in that country and establish their market position. These dealership networks assist industry participants in establishing brand recognition and making used car options viable, primarily for the middle-class population.

The used car dealer is dependent on the seller because the dealer cannot obtain the vehicle to serve their consumers until the owner sells it in the market. If new car sales fall, the market will run out of supply after a while. This may hamper the market growth over the forecast period.

Key Market TrendsTECHNOLOGICAL ADVANCEMENT IN THE ONLINE MODE SEGEMENT IS EXPECTED TO FOSTER THE DEMAND OF TARGET MARKET

Technology advancements, such as the expansion of the online mode for booking and the use of e-commerce sites/applications, are predicted to expand the target market. Furthermore, the role of online sales has emerged as a crucial growth component in the industry. Online sites in vehicle marketplaces have played a critical role in providing consumers with access with a single click.

Consumers are getting more aware of the vehicle, its residual value, third-party margin, and other factors due to internet booking. A confluence of such trends resulted in a huge increase in demand for used cars. Furthermore, factors such as affordability, the availability of secondhand automobiles, the increased need for personal mobility, and the rise of multiple internet companies to organize the market have led to the growth of the market growth. Although, several leading companies have opened online and offline stores throughout the country to provide smoothly used car purchasing experiences.For instance,

• In January 2022, CarBravo, a new way to shop for used autos, was launched by General Motors. CarBravo will improve the shopping, buying, and ownership experience for used-vehicle customers by providing them with a large inventory, an omnichannel shopping experience, and exclusive ownership perks.
• In September 2021, AutoNation, Inc., one of the largest America's automotive retailer, announced the opening of AutoNation USA Denver 104, the second of five more pre-owned vehicle stores that the business will establish this year. By the end of 2026, AutoNation expects to have over 130 AutoNation USA locations open from coast to coast. To gain a larger portion of the used vehicle market, AutoNation USA stores will continue to leverage the AutoNation brand, scalability, and proven Customer-centric procedures.

UNORGANISED VENDOR TYPE SEGMENT IS EXPECTED TO HOLD SIGNIFICANT MARKET SHARE

Buying a used car is a terrific method for a middle-class or learner driver to get a good vehicle for a low price and eventually go on the road without spending a bunch. There is no shortage of used vehicles for sale, so selecting the correct one might be difficult.

The used car market is dominated by unorganized and semi-organized dealers, with unorganized dealers accounting for the majority of independent dealers in the country. Participants place a high value on newer vehicles and popular brands with high resale value. The automobile market in the United States is seeing yet another significant transition as prices continue to fall from all-time highs due to the pandemic.

The emergence of new market competitors and new retail methods has also emerged as a crucial element in driving market expansion. According to the National Automobile Dealers Association, franchised dealers generated higher gross earnings on used vehicle sales than independent dealers in the United States. Furthermore, organized merchants profited from increased brand loyalty across all age groups.

• In March 2022, TrueCar, Inc., the most convenient, efficient, and transparent online destination for buying and selling new and used vehicles, today announced the launch of its Sell Your Car offering and the introduction of its Home Delivery programme in Texas. TrueCar's Home Delivery initiative, which is now being tested in Texas, would allow any dealership to significantly increase the market reach of their used car inventory within their region or even nationally. Furthermore, clients benefit from a larger used car range and the ease of home delivery. TrueCar intends to expand its service to additional markets in the second quarter.

Competitive Landscape

The United States used car market is highly fragmented, with multiple startups and regional competitors. However, prominent rental companies are forming joint ventures and partnerships to launch newer products in order to obtain a competitive advantage.

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• The market estimate (ME) sheet in Excel format
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