With the country’s used car market getting bigger by the day and outpacing the new car market in terms of volumes, the multi-brand chain Mahindra First Choice Wheels Limited is set to rapidly expand its chain of network of retail franchises and expects to take it past the 450 mark by fiscal end, up from 380 now.

The used car market is growing at about 20 per cent per annum and the company sees this trend continuing.

“With over 2.8 million used cars sold last year, as against new cars of about 2.4 million, the former is set to get a lot bigger. Therefore, we are gearing up for the potential in the segment where we have already carved a niche,” Nagendra Palle, Chief Executive Officer of Mahindra First Choice, said.

Speaking after inaugurating its new retail store close to the IT hub of Hyderabad, he said, “In matured global markets such as the US and Europe, the ratio of used cars versus new cars sold is in the range of 3:1. We expect the Indian market also to grow significantly from the current ratio of 1.2: 1 for used cars and new cars.”

The other trend that is likely to emerge is that the used car market, predominantly a domain of the unorganised sector, is slowly getting organised. Thought it is still small as a part of the overall market, trends point towards growth of the organised sector, where Mahindra First Choice as also other original equipment manufacturers operate with their used car outlets, getting bigger.

“Our experience shows that the First Choice dealers are prospering. This suggests that the used car market dominated by the unorganised sector, sees value in the trust created by organised retail, offering certified cars and after sales support,” Yatin Chadda, Senior Vice President, said.

Last year, MFC facilitated sales of more than 57,000 cars through dealers and about 70,000 cars sales through business to business platform.

The Indian Blue Book launched by the company provides a used car pricing guide that incorporates transaction data. The used car market mimics the new car market in many ways. Trends show that the average price for MFC car sold is about Rs 4 lakh with the average age of buyer in the range of 30-35 years, the CEO said.

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