RS Kalsi is an old hand at Maruti Suzuki India. The sales and marketing head of the country’s largest passenger car company is composed but also understandably pleased to share Maruti’s growth numbers from the past four years. “It was 9% in FY12, 14% in FY13, 18% in FY14 and this year, we are at 30-plus levels.” Contrary to one’s initial assumption, these numbers are not for the new passenger vehicles sold by Maruti but are, in fact, growth numbers for used cars that are sold by the company through its True Value outlets.
Kalsi, who laid the bricks for the first-ever pre-owned car showroom in India 13 years ago, is a little nostalgic. At the turn of the century, Maruti sent out a team to survey the old-car business elsewhere in the world, leading to the establishment of True Value. Today, that market is finally seeing its value. “The used-car population within the Maruti portfolio has increased. Today, we have nearly one-and-a-half crore customers. After 3-4 years, these cars will come back into circulation. So, the basic mass is increasing,” says Kalsi.
In India’s used-car market, around 3 million vehicles change hands every year, a figure that’s much higher than that for new cars. Of these, roughly a fifth pass through the organised market, where the other big player is Mahindra First Choice. What sets First Choice apart from True Value is that the former sells all brands under its roof, thereby offering a wider menu for customers to choose from. Nagendra Palle, CEO of the multi-brand car mart, testifies to the rapid growth in the used-car segment. “We will have sold 70,000 vehicles this fiscal, against 50,000 last year. The number of dealers has also increased to 410 in 220 cities.”
Almost all original equipment manufacturers (OEMs) have been trying to grow their used-car business, with those who missed the bus earlier now aiming to catch up. The most recent used-car business aspirant is Renault, which found fortune in India with its compact sports utility vehicle Duster. The company ann