Maruti broad-bases its True Value biz with a ‘one-stop destination for used cars’ push

Maruti Suzuki India Ltd has taken a big leap in its used car business that will see the country’s top car maker growing sales of pre-owned cars significantly, with the possibility of creating a good number of jobs, while growing the brand bigger with expanded customer reach.

Maruti Suzuki’s pre-owned car network has been growing strongly. The True Value business sells about 4.5 lakh pre-owned cars every year. If this number is taken as car sales, True Value will be the third-largest independent car seller after Maruti Suzuki and Hyundai Motor India.

The company has now decided to transform the business from a largely car exchange-based model to a full-fledged used-car market place.

Hereafter, the True Value network, which has 570 outlets across 280 cities, will accept cars from any brands. So, owners of any car brand can sell their vehicles at True Value outlets regardless of whether or not the customers buy Maruti cars or not. Earlier, people were selling their old Maruti or other brand cars to buy a Maruti vehicle.

“There is a good chunk of car owners who want to sell their old cars, but not necessarily buy new cars. So with this move, we want to broad-base it and make it more convenient to a large number of customers and it will also help us build customer relationship in the long run. The overall objective is to make True Value a one-stop destination for buying and selling quality pre-owned cars,” Shashank Srivastava, Executive Director (Marketing & Sales), Maruti Suzuki India, told BusinessLine .

He felt that the timing was also ripe to grow the used car business as organised players in this space were able to grow their share with more number of car owners looking for a transparent and hassle-free transaction space for their old cars.

In India, the used car market is about 1.5 times the new car market. Last year, 35 lakh was the new car market, while the used car market was estimated at 40 lakh units.

While most of the transactions in this space happen in customer-to-customer (C2C) mode, organised players like True Value and others have been seeing a surge in their transactions. The market share of organised players has grown to 18 per cent now from 10 per cent a couple of years ago. This trend will continue, said Srivastava.

As the company broad-bases its True Value business, it expects many gains. First, the volume is expected to growth significantly, and with that the profitability will also increase. The higher volume will also provide opportunities for launching future models.

As the volumes grow, the company will hire more people for sales and evaluation and related requirements, along with the ramp-up of True Value outlets.

“As of today, we have 5,400 evaluators in True Value outlets and the number of sales executives is close to 4,000. It is a pretty large workforce and it will grow even more once the volumes see a surge,” he said.

Srivastava also believes that with the latest move the company would be able to expand and strengthen the relationship with customers even from the enquiry levels. The Maruti brand will grow bigger. Estimates put pre-owned-car-related searches and queries at about 17 crore in 2019, and growing at 30 per cent every year.

Maruti re-launched True Value with a new brand identity about three years ago to enhance the pre-owned car buying experience.

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