1. The Australia Used Car Market witnessed a robust growth as a result of increased market supply and a shift towards organized and transparent trade.
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Australia Used Car Market is currently in its growing phase and registered a CAGR of 21.8% in the period of 2016-2021. Due to supply chain problems for new vehicles and Australians selling their cars after a year or two in order to upgrade, the market for used vehicles is increasing. Fast increasing disposable income per household, greater supply in the market, and a move towards organized and transparent trade will drive the used-car market. The market growth is further supported by manufacturers investments in expanding the network of used cars dealers, building the brand and enabling customers to choose this option.
2. Used to new car ratio is representative of the maturity of the pre-owned car industry. This ratio has held steady between 2019-2020, which signifies the beginning of a new era in the pre-owned car market.
Entry level used cars are perceived to be safer than two-wheelers. Hence there is a shift towards used car buying, resulting in greater customer pull for the demand of used cars in Australia. With rising income levels, there is also a lower ownership cycle now - people upgrade or change cars faster than ever before. Due to the impact of COVID-19, there has been a substantial decrease in the denominator while the numerator, i.e. the pre-owned car market, has been relatively stable.
The primary factor driving the expansion of the used car industry is the lack of original manufacturing facilities, importation of all automobiles, and lack of an assembling facility in Australia. As a result, people choose to buy used cars solely, making it difficult to balance supply and demand. Used to new car sale is rising as used vehicle models have lots of the latest technologies that large families can easily accommodate and enjoy good features & new technology at relatively low rates compared to the new vehicles.
3. The Un-organized sector dominates the Used Car Market in Australia.
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Un-organized sector dominates the overall market share, driven by awareness about buying and selling used cars through online advertisements. The awareness about buying and selling used cars has increased through online advertisements and publicity. Independent dealers have major influence on the market due to large presence across the country. These dealers are increasing their online presence by listing their inventory on their own website/Facebook account or platforms, thereby attracting customers.
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