Companies

Shriram Automall acquires online car auction platform BlueJack

Our Bureau Mumbai | Updated on February 17, 2020 Published on February 17, 2020

Shriram Automall India Limited (SAMIL) on Monday announced that it has acquired BlueJack, an online car selling portal, in a bid to give a boost to its offline auction market position with online used car sales.

SAMIL is jointly owned by Shriram Transport Finance Company (STFC) and MXC Solutions India Pvt Ltd (MXC).

While declining to give any financial details, Shriram Automall said in a release that with this acquisition, it targets to transact over 12 lakh vehicles a year, worth more than ₹30,000 crore.

Using the Shriram platform, BlueJack, currently a prominent player in the Delhi-NCR market, will be implementing its experience and technology across the country, it said. BlueJack is expected to fully integrate with SAMIL’s operations and group companies in the first half of 2020.

Additionally, there will be synergies in play with SAMIL’s existing shareholders, STFC and MXC Solutions, it said. The company said that over one crore customers of SAMIL and its affiliates will get additional means of car selling through this deal. While STFC is a player in used commercial vehicle finance, MXC Solutions operates the used and new car market places CarTrade and Carwale.

“We are excited to upgrade our offerings across India with BlueJack. We look forward to learn from them and share our own experience of operating at scale across 150 auction locations spread over 100 tier-1, tier-2 and tier-3 cities. Together, we believe we can offer the best auction experience for our Indian market with innovative technology,” said Sameer Malhotra, CEO of Shriram Automall.

This is in the backdrop of the used-car sales registering double-digits growth at a time when new car sales have been plummeting, as reported by BusinessLine on January 13. This is due to a slew of factors, including the reluctance to invest in a new car during an economic downturn, increased affinity for value consciousness, better availability and quality of vehicles coming into the used-car market, more transparent pricing of used-cars than earlier, and increased penetration of organised players.

Since its inception in 2016, BlueJack, which operates in Delhi with dealers from 10 states, has auctioned more than 25,000 vehicles on its platform. BlueJack buys cars using its proprietary pricing database and a live auction helps calculate an offer within minutes, and then sells the vehicles to one of its 5,000 empanelled dealerships.

The Indian used car market, which is 1.2 times the size of the new car market, is expected to grow at a compound annual growth rate (CAGR) of 18 per cent. It grew steadily in FY19, crossed the 40 lakh-unit mark, driven partly by the increasing demand for used vehicles in tier-2 and tier-3 cities. It is poised to reach 70 lakh cars per year by FY22, the company said.

Published on February 17, 2020
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