Frost & Sullivan sees downtrend in used car market until 2020
Used car dealers are said to be more selective in buying trade-ins, selecting only brands and models that can be sold off quickly.
Used-car sales volumes are expected to fall from 394,000 units in 2014 to 300,700 units in 2020, according to global growth consulting firm Frost & Sullivan.
In its latest analysis, 'Strategic Insight into Used-Car Market in Malaysia', it said the local used car market functions in tandem with the new car market.
"If the prices of new cars fall, so will the prices of used cars. In these circumstances, customers are more likely to invest in new cars rather than used ones," Frost & Sullivan Automotive & Transportation Principal Consultant Animesh Kumar said in a statement Tuesday.
He said many used car dealers in Malaysia have been looking to cut down inventory to decrease exposure should new car prices drop unexpectedly.
"They are more selective in buying trade-ins, selecting only brands and models that can be sold off quickly.
"Used car dealers should design platform strategies involving mobile apps and virtual technicians to better educate, communicate and build relationships with customers.
"These measures would enable them to compete with new car manufacturers, who have been implementing aggressive promotional campaigns and offering discounts to customers," he added.
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