Easy finance drives out second-hand car market

CHANDIGARH: Easy finance options on new cars though are making buying hasslefree and easy for customers, especially those belonging to middle class, they are having an adverse effect on the sales of used cars in the city.
Used car dealers here say that the availability of a wide range of finance options combined with lowering of upfront payment and monthly instalments is driving the consumers to new cars.
Says Harpreet Singh of Sector 7 second-hand car market, "Owing to the easy finance schemes, these days a customer having Rs 50,000 to 60,000 can easily go for a new car. In contrast, he can only get a 1989 or 1990 model of Maruti 800 for this amount."
Dealers say that the sales of used cars have decreased by 25 to 30 per cent as compared to last year.
Though the finance option is now available on secondhand cars too, but it has its limitations. Customers have to deal with issues related to transfer of ownership.
Dealers here say that the finance options are easily available only on sale of a car registered in Chandigarh. "It is difficult to get finance on cars registered in some other place," says a dealer.
Car dealers say that a majority of the second-hand cars coming to the Chandigarh markets are registered in some other place. Among these, more than 60 per cent of the cars are registered in Haryana, with Chandigarh accounting for around 10 to 15 per cent.
Dealers say that though cars registered in Chandigarh are the most in demand, their has been a significant decline in such cars being brought for sale in the second-hand market, as "people in Chandigarh normally prefer to use their cars for three to four years".
Setting up of second-hand car sales ventures like True Value by Maruti and the exchange schemes offered by a host of other car manufacturers, too, have proved to be dampener for the sales of used cars.
"Customers get the value of their cars assessed by the dealers of these companies and then expect us to sell the cars at the same price," says Singh.
Apart from this, the used car sales in the city have been affected by the setting up of second-hand car markets in places like Samrala, Patiala and Nabha.