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Ken Research study says oil-rich kingdom’s used car market is growing again after a decline in growth in 2016.
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The market is expected to grow at a CAGR of 4.5%
The used car market in Saudi Arabia has rebounded with a reasonable growth in sales of cars, after the market witnessed a dip in 2016, according to a Ken Research report “Saudi Arabia Used Car Market Outlook to 2025.
“The used cars market in Saudi Arabia after declining post 2016, witnessed recovery in 2019 and improvement in the used to new car sales ratio. Increasing value-added service offerings, rising presence of dealerships online and introduction of Mojaz online vehicle history report are further expected to drive the industry’s growth in the future,” noted the research report.
The market for used cars in Saudi Arabia is expected to grow at a CAGR of 4.5% on the basis of gross transaction value over the forecast period of 2019-2025. In order to tap more consumers, many authorized dealerships are expected to increase their presence online. Along with the listing of used car inventory online, some dealerships are planning to develop e-commerce platforms to sell used cars and to enable 100% online end-to-end transactions from the convenience of the homes without having to visit the showrooms.
Although traditionally sedans have dominated the used car sales in the country, recently there has been increasing demand for SUVs & crossovers. SUVs and crossovers are suitable for the hot & harsh climatic conditions in the country and have relatively longer ownership period.
The online platforms as well as dealerships looking to expand their presence online plan to implement latest technologies such as 360 degrees 3D view of the interiors & exteriors, artificial intelligence to leverage consumer behavioral insights and more in order to create a better user browsing experience. These technologies along with the provision of detailed vehicle history & inspected reports are expected to be a game changer in the market.
The Saudi Traffic Department introduced the facility for online transfer of ownership for sale of vehicles amidst the Covid-19 lockdown to enable transfer without requiring a periodic technical inspection. The adoption of online channels for purchasing cars is rapidly increasing as a spill-over of the Covid-19 pandemic.
