Indonesia Used Car Market: Resilient Growth Surpasses 2.5M Units Sales in 2019

JAKARTA, Indonesia - May 3, 2024 - PRLog -- Despite pandemic upheavals, Indonesia used car market displays remarkable resilience, maintaining an upward trajectory amidst disruptions across sectors. Consumers' growing preference for pre-owned vehicles is evident, with used car sales surpassing 2.5 million units in 2019.

Pandemic Propelled Growth:
The pandemic drove more car purchases online, following broader retail trends. Simultaneously, the global chip shortage increased demand for used vehicles as new car production slowed. This led to double-digit growth in Indonesia's used car market in 2023, showcasing its resilience.

Persistent Challenges:
Despite the strong performance, the Indonesian used car market faces hurdles like regulatory complexity, demand fluctuations, and logistical challenges. Quality and reliability concerns are shared by buyers and sellers alike.

Company Performance Reflecting Market Growth:
In Q1 2022, Adi Sarana Armada's revenue from used vehicle sales surged by 56% year-on-year, with operating margins also growing by 6.8%. This underscores the positive momentum of Indonesia's used car market.

Driving Economic Growth:
Indonesia's automotive sector, contributing 4% to the GDP in 2021, continues to be a crucial driver of economic growth. Research and development efforts bolster the nation's automotive industry, with the used car market playing a significant role in this trajectory.

Despite a downturn in mid-2021, the Indonesia used car market rebounded by the end of the third quarter, driven by improved income levels and increased mobility. Consumers' inclination towards upgrading cars has reshaped market dynamics, further fueled by enhanced accessibility to car financing options.

Emerging Trends and Challenges:
Shifting consumer behavior and increased demand for affordable options are fueling significant growth in the used car market. However, the rising popularity of electric vehicles presents challenges, necessitating adaptation and innovation.

Balancing New and Used Car Sales:
In Jakarta, there's a notable shift occurring in the balance between new and used car sales, with both converging. However, this trend varies across major cities. In 2022, the ratio of used cars to new cars was 4:1, indicating substantial growth opportunities in the used car market nationwide.

Strategic Expansion and Market Impact:
Carro's impact in Indonesia has been significant, with its platform utilized by over 5,000 used car dealers, representing approximately 30.6% of new automotive sales in Southeast Asia. Carro's Buyback platform has enabled dealers to expand their inventory and profitability.

Rising Competition and Impact on Prices:
Increased competition from new vehicles may impact used car prices and sales. As new cars become more affordable, consumers may prefer them over used cars, potentially leading to a decrease in demand and prices.

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Indonesia Used Car Market Analysis and Forecast (2019-2030) (https://www.makreo.com/report/indonesia-used-car-market-a...)