The novel coronavirus pandemic has upended businesses across the world resulting in dwindling revenues across several industries. Amidst the most challenging of circumstances, online inquiries for used cars under Rs3 lakh almost doubled, while inquiries for on-road price of vehicles jumped 91% during 12 months till September 2020, says a report.
The report, prepared by CarWale, shows that between September 2019 and September 2020, it witnessed 146% upsurge in car loan leads resulting in 20% growth in lead conversion.
Banwari Lal Sharma, chief executive of CarWale and BikeWale says, "With evolved consumer behaviour laying impetus on personal mobility and driving this change, the automotive industry is booming like never before. Our internal data states that vehicle purchase has climbed up the priority list of consumers especially during the pandemic."
Micro Budget for Big Purchases
Owing to the impact of the pandemic on the job market, a large segment of consumers has tightened its budgets and decreased spending on big items. However, due to the lack of social distancing in Indian public transport systems, personal mobility has emerged as a non–negotiable.
CarWale and CarTrade have witnessed a 175% surge in online inquiries for used cars under Rs3 lakh ever since lock-down restrictions were eased. Additionally, there has been a resultant 146% upsurge in car loan leads.
"Although there has been a rise in inquiries by 30% for hatchback cars, considering the pent up demand, there has also been a sparking interest for other ‘affordable luxury’ body types like sports utility vehicle (SUV) and multi utility vehicle (MUV). As millennials and first-time buyers show a growing penchant for ‘economy’ cars to commute to work and for everyday usage, the SUV and MUV category is also emerging as a competitive segment," the report says.
Growing Dependency on Digital Platforms To Research about New Cars
CarWale claims that it has become the preferred platform for online research among consumers who want to buy new cars and are looking to stay updated on the latest launches. It says, "Compared with September 2019, the website has witnessed a 36% increase in traffic for new car searches, with a 91% increase in customers searching for on-road price of vehicles in September 2020."
Online Space Emerges as the Most Convenient Marketplace for Purchasing Used Cars
According to Google’s "Auto Gear Shift India Report 2020", 94% of used car-buyers chose to research online to find their desired vehicle and all used car-sellers preferred digital platforms to research and connect with buyers.
Gaining traction from this demand, CarWale and CarTrade witnessed a 67% increase in unique users on a y-o-y (year-on-year) basis, September 2019 compared with September 2020.
The report says, "The auto media vehicle received 55% more inquiries on every used car listed on the website in September 2020 as compared to the quarter covering November 2019- January 2020, It was observed that 54% consumers inquired for more than three brands while searching for used cars."
The New Normal Brings in New Opportunities for the Auto Industry
According to the report, an increasing number of consumers is showing confidence in using contactless services offered by digital platforms, resulting in an uptick for digital sales and online inquiries for cars. "CarWale has seen a 20% growth rate in lead conversion for September- October 2020 vs 2019; the resultant dual effect of post lockdown shopping and the festive season. Riding on this shift in consumer behaviour, the website recently added a handful of new features to further enhance user experience," it added.
Mr Sharma says, "We understand that a car is by and large the second most expensive asset a consumer purchases and are hence heavily focused on optimizing efforts to ensure a seamless and hassle-free experience. CarWale and its two wheeler portal BikeWale, have witnessed a 38% increase in unique visitors in September 2020, a 21% increase in mobile app installs, and a 27% increase in app sessions as compared to September 2019."