Buying a car, whether it is a new or used one is all about having a smile in a budget that one can put easily and for that matter, a used car will never let you down and proves value for money.
According to the recent report on India’s pre-owned car market published by IndianBlueBook,
In the year 2018–19, 4 million used cars have been bought and sold whereas for the same period only 3.6 million new cars were sold.
This highlights the fact that the majority of buyers prefer used car over a new one. We can ascribe this disruptive development in the automobile market to an open secret that is depreciation. It’s said that a year-old vehicle depreciates about 30%. Although buying a new car is more enticing that one can boast of, one cannot afford to ignore the relative benefits and advantages of a second-hand car as given below.
- Reliability: Today’s cars demand less expenditure on maintenance as compared to cars a decade ago. Dependability is a factor that causes buyers to incline towards a used car.
- Less Depreciation: The used cars depreciate at a slower pace than the newer ones. A new car that costs rupees 10 lac can be sold at around rupees 7 to 8 lac after a year of buying but the same car may fetch you almost the same amount after three years if maintained well.
- Less cost — more comfort: You get the comfort and luxury of a higher segment in a relatively low budget. Instead of going for a new Swift Dezire you can get a pre-owned Skoda Octavia in the same budget.
- Less cost to insure: The new cars cost more to insure while the used cars demand less owing to the depreciation that keeps insurance cost lower.
The boom in a used car market and the emergence of platforms such as OLX Cash My Car and Cars24 have made selling and buying of the car so easy. Ultimately it’s your call whether to buy a new car at higher cost and bear depreciation or go for a well maintained pre-owned car with more comfort at relatively low cost
(Note: The same article has been published on LinkedIn by the same writer)
