Mahindra First Choice is setting up a separate line of dealerships for used luxury cars christened Edition
Swaraj Baggonkar
@swarajsb
Every time a new luxury car is sold in India, two pre-owned or used cars from the segment also change hands.
Last year, used luxury car sales rose more than 30 percent to around 60,000-70,000 a year, compared to about 17 percent growth in new car sales to 40,000 units.
The growth in sales of used luxury cars is, in fact, growing faster than the overall second-hand car market, which has a growth rate of 15-20 percent.
The average price of used luxury cars such as those from Mercedes-Benz, BMW, Audi, Volvo and Jaguar Land Rover are between Rs 25-35 lakh. The top-of-the-line models from Ferrari, Bentley, Porsche, Lamborghini are also in demand, albeit with a price tag of over Rs 1 crore.
Ashutosh Pandey, CEO, Mahindra First Choice Wheels said, "Aspirational buyers with high disposable incomes are looking to upgrade to premium car brands. Most new car dealers who do trade-ins do not have an outlet to sell it. So we would be sourcing such cars from them before selling them through our channel".
To that effect, Mahindra First Choice is setting up a separate line of dealerships for used luxury cars christened 'Edition'. The first of such dealerships was opened at Juhu in suburban Mumbai last week. Around 5-6 such stores will be opened with each of them targeting sales of up to 20 units every month.
"In certain clusters, we realised the people's need for a sharper focus on separate sales outlet for used luxury cars. That is why we set up 'Edition'. We sold 20 luxury vehicles from one showroom alone", added Pandey whose company is the largest player in the branded pre-owned car space.
While the Mahindra Group has the scale to expand the business with 1,200 outlets across the country, it is certainly not the first to enter the segment.
Delhi-based Big Boys Toyz (BBT), which was set up a decade ago, buys luxury cars from private consumers and companies, runs multi-point checks as part of refurbishment process before selling them through its limited number of outlets.
Besides, the usual line of luxury carlines BBT, which has an annual turnover of Rs 200 crore, also sells some rare models as well including BMW i8, Hummer and Maserati Quattroporte. A few weeks ago the company opened its first outlet in Andheri, another suburb of Mumbai.
Last year, the new luxury car market clocked volumes of nearly 40,000 units. Mercedes-Benz remained the market leader for the third year followed by BMW, Audi and Jaguar Land Rover.
Lowered entry price tag coupled with the launch of compact models and the introduction of new models helped the new luxury car industry sustain growth momentum. India's used luxury car market has grown ten times in the last 10 years, as per data shared by companies.