How have been the Performance of Indonesia Used Car Industry?
Decades ago, the used car market in Indonesia was dominated by unorganized players including self-appointed used car dealers, car owners and road side mechanics that were not certified by the government. Word of mouth advertising was one of the main marketing channels and no major companies were operating in the used car space. The lack of organized players in the used car business meant low choice and information asymmetry for buyers.
While the conventional system of buyers meeting sellers face-to-face in the marketplace is still the dominant practice in society, more Indonesians are seeing the online market as a great alternative means for making purchases. The gross transaction value (GTV) of the used car industry inclined to USD billion during 2016 from USD ~ billion during 2011, achieving a CAGR of ~% during 2011-2016. The sales of used cars inclined from ~ units in 2011 to ~ units during 2016, achieving a CAGR of ~% during 2011-2016. The gross transaction value generated from unorganized segment stood at USD ~ million during 2016, which has contributed ~% to overall used car transaction value during the same period. The unorganized sector witnessed total sales of ~ units of used cars during 2016, contributing ~% to overall used car sales during the same period.
Market Share of Major Players
OLX achieved a share of approximately ~% of overall online sales of used cars which was evaluated to be ~ units during 2016. The website first came into existence in 2005 with the name tokobagus.com as the biggest online trading center in Indonesia with around ~ million visits per day. Carmudi achieved a share of ~% of overall used car sales online during 2016 which were evaluated to be ~ units during the same period.
Carmudi works similar to OLX, however; the company brings buyers and sellers together and transact between new and used cars only. The company came into existence in 2013 in Germany and entered the used car market in Indonesia during 2014. Apart from online sales, the company also has a strong offline presence established in Jakarta and subsidiaries in Bandung, Semarang, Medan and Makassar. Mobil88 achieved a share of around ~% in terms of online sales of used car in 2016, totaling to a mere ~ units during the same period. Mobil88 has a stronger offline presence and has recently started building its presence in the online market. Due to this, the company has ~ active listings as on December, 2016.
Future Outlook for Indonesia Used Car Industry
The Gross Transaction Value (GTV) generated from the sale of used cars in Indonesia is projected to augment to USD ~ million during 2011 from ~ million during 2017. The sale of new cars is estimated to increase from ~ units during 2017 to ~ million units during 2019 due to increased sale of economy cars and hatchbacks. The sale of used cars is projected to augment to ~ units by 2021, achieving a CAGR of ~% during the period 2017-2021.
The reduction in ownership pattern will cause influx of a wide variety of car models into the used car industry, giving customers more choice while purchasing used cars. The sale of used cars through local dealers is estimated to augment to ~ units by 2020, contributing ~% to overall sales during the same period. The sale of used cars through online auto portals is estimated to stand at ~ units during 2021, contributing ~% to overall used car sales during the same period. The increasing internet penetration will be the primary force driving sales through this marketing channel. Online auto portals help buyers understand the prevailing (maximum and minimum) price for their desired car.
The sale of used cars through multi-brand car showrooms is estimated to increase to ~ units by 2021, contributing ~% to overall used car sales during the same period. The sale of used cars from dealers to customers and car owners to potential buyers through word of mouth, newspaper advertisements and magazine classifieds is projected to increase to ~ units during 2021, contributing ~% to overall used car sales during the same period
Companies Cited in the Report
List of Companies Companies Covered in the Report
Oto.com Major Players
Key Factors Considered in the Report
Value Chain Analysis in Indonesia Used Car Industry
Indonesia Used Car Market Size on the basis of Gross Transaction Value and Sales Volume
Market Structure (organized/Unorganized) in Indonesia Used Car Industry
Market Segmentation of Indonesia Used Car Industry on the basis of type of used car, marketing channels, major cities, year of manufacture, vehicle use and other
Customer profile in Indonesia Used Car Market on the basis of Age Group, Income and Gender
Government Regulation in Indonesia Used Car Market
Financing options and Schemes available to potential buyers in Indonesia Used Car Market
Market Share of Major Players in Indonesia Used Car Market
The various Business Models prevalent in Indonesia Used Car Market
Competitive Landscape of Major Players in Indonesia Used Car Market
Trends and Developments in Indonesia Used Car Market
Issues and Challenges in Indonesia Used Car Market
Decision Making Process for Buying a Used Car in Indonesia
Indonesia Used Car Market Future Outlook and Projections on the basis of Gross Transaction Value and Sales Volume
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Ankur Gupta, Head Marketing & Communications