Used Car Market in UK to Grow by USD 35.7 Billion by 2028, Excellent Value-for-Money Proposition of Used Cars Boosts Market, Report with Market Evolution Powered by AI - Technavio

NEW YORK, Feb. 4, 2025 /PRNewswire/ -- Report on how AI is driving market transformation - The Used car market in UK size is estimated to grow by USD 35.7 billion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of 5.97% during the forecast period. Excellent value for money proposition of used cars is driving market growth, with a trend towards improved touchpoint management. However, increasing preference for car subscription services poses a challenge. Key market players include Alibaba Group Holding Ltd., Aramis Group, Arnold Clark Automobiles Ltd., Auto Trader Group Plc, Bauer Media Group, Car Giant Ltd., Carcraft.co.UK, CarGurus Inc., CarMax Inc., Cazoo Ltd., Cinch Cars Ltd., Constellation Automotive Group Ltd., Group 1 Automotive Inc., Hertz Holdings Inc., Lithia Motors Inc., McCarthy Cars UK Ltd., Motors.co.UK Ltd., Penske Corp., Toyota Motor Corp., and TrueCar Inc..

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              Used Car Market In UK Scope



     Report Coverage                                  
     Details



     Base year                                                                                                                                                 2023



     Historic period                                  
     2018-2022



     Forecast period                                  
     2024-2028



     Growth momentum & CAGR                                                                                                           Accelerate at a CAGR of 5.97%



     Market growth 2024-2028                          
     USD 35.7 billion



     Market structure                                 
     Fragmented



     YoY growth 2022-2023 (%)                                                                                                                                 5.28



     Regional analysis                                
     UK



     Performing market contribution                                                                                                                  Europe at 100%



     Key countries                                    
     UK



     Key companies profiled                             Alibaba Group Holding Ltd., Aramis Group, Arnold Clark Automobiles Ltd., Auto Trader Group Plc, Bauer Media
                                                          Group, Car Giant Ltd., Carcraft.co.UK, CarGurus Inc., CarMax Inc., Cazoo Ltd., Cinch Cars Ltd.,
                                                          Constellation Automotive Group Ltd., Group 1 Automotive Inc., Hertz Global Holdings Inc., Lithia Motors
                                                          Inc., McCarthy Cars UK Ltd., Motors.co.UK Ltd., Penske Corp., Toyota Motor Corp., and TrueCar Inc.

Market Driver

The UK used car market is thriving, with trends including the popularity of hatchbacks, sedans, and Sports Utility Vehicles (SUVs). Organized dealerships, including franchised and independent dealers, dominate the market, offering quality used cars from OEMs and banks. NBFCs and insurance companies also play a significant role. Petrol and diesel vehicles continue to lead, but hybrid, electric, and CNG-powered vehicles are gaining ground. OEMs are expanding their dealership networks, offering used car management services. Online sales channels, including auto marketplaces and car subscription services, are growing. The average ownership duration is decreasing, leading to an increase in off-lease vehicles. The organized sector, including franchised dealers and leasing offices, is seeing increased competition from unorganized businesses. Emission standards are a key consideration, with gasoline-fueled cars and diesel-fueled passenger cars facing scrutiny. SUVs, mid-sized, and compact cars dominate the large category, while the electric segment, including used electric vehicles, is growing in the online category. Artificial intelligence and machine learning technology are being used to improve used car valuation and financing, with quality finance charges a key consideration for sellers.

Online used car dealers in the UK are focusing on enhancing their website experience to attract potential buyers. These sites serve as the primary touchpoint for researching various car models, features, prices, and locations. Dealers use touchpoint management technologies to gather customer feedback on website interface. Customers spend significant time examining car details before making a purchase. Consequently, creating an easy-to-use and visually appealing website is crucial for dealers to engage customers effectively. Many online used car websites offer customized research services to cater to individual buyer preferences. Therefore, investing in an user-friendly and attractive website is essential for success in the used car market.

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Market Challenges

    --  The UK used car market is a significant sector, encompassing various
        segments like Hatchbacks, Sedans, and Sports Utility Vehicles (SUVs).
        The market includes both organized and unorganized sectors. Organized
        players include OEMs, banks, NBFCs, dealers, insurance companies, and
        auto marketplaces. They offer a wide range of passenger cars, including
        petrol, diesel, hybrid, electric, and CNG-powered vehicles. Challenges
        for the used car industry include managing quality, residual value, and
        finance charges. Sellers can sell through dealership networks, online
        sales channels, or directly to consumers. Franchise dealers and
        independent dealers operate in the organized segment, while individual
        garages and unorganized dealerships are part of the unorganized sector.
        The market includes luxury vehicles, mid-sized and compact cars, and
        SUVs. Technological advancements like artificial intelligence and
        machine learning technology are transforming the industry. Off-lease
        vehicles, franchises, car dealers, leasing offices, and car subscription
        services are also part of the market. The average ownership duration
        varies, with online retailing and the telecom industry influencing
        trends. Emission standards, gasoline-fueled cars, and diesel-fueled
        passenger cars are crucial considerations. The SUV and electric segments
        are growing, with used electric vehicles gaining popularity.
    --  The car subscription model is an emerging business trend, gaining
        popularity among individuals seeking flexible and cost-effective
        transportation solutions. This model allows customers to select various
        vehicle models for a predetermined period and mileage, providing
        financial relief by requiring only a fraction of the vehicle's cost. The
        car subscription model may potentially decrease the demand for used car
        purchases due to its affordability and convenience.

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Segment Overview

This used car market in UK report extensively covers market segmentation by

    --  Channel
        --  Organized
        --  Unorganized
    --  Vehicle Type
        --  Compact Car
        --  SUV
        --  Mid Size
    --  Type
        --  Petrol
        --  Diesel
        --  Others
    --  Geography
        --  Europe

1.1 Organized- Used car market in the UK is served by various organized vendors, including dealership chains, online marketplaces, and OEM-affiliated dealerships. These vendors ensure a secure transaction by offering guarantees and safeguards to both parties. They facilitate smooth vehicle ownership transfer through local government partnerships, providing transparency regarding timelines and fees. Many vendors offer technical assistance and capital support to customers. They are proficient in digitalization, creating a hassle-free buying experience. Advanced technologies like blockchain are adopted to maintain vehicle ownership records, parts replacement, and service history details, enhancing buyer confidence. For instance, Cars24, an online pre-owned vehicle marketplace, reported that one-third of its sales in April 2022 were made through chat support channels, including WhatsApp and an AI chatbot. The integration of modern technologies, such as AI and blockchain, fuels the growth of the organized used car market segment in the UK.

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Research Analysis

The used car market in the UK is a significant sector of the automobile industry, encompassing a wide range of vehicles including Hatchbacks, Sedans, and Sports Utility Vehicles. The market is organized and unorganized, with both franchised dealerships and independent car dealers playing a role. Petrol and Diesel vehicles dominate, but Hybrid, Electric, and OEM off-lease vehicles are increasingly popular. Banks and leasing offices provide financing options, while car subscription services offer flexible alternatives to traditional ownership. The average ownership duration is around 6 years, and the telecom industry and online marketplaces have disrupted traditional sales channels, leading to an increase in online retailing. Automobile manufacturers continue to play a role in used car management through their dealership networks and OEM certified pre-owned vehicles. Residual values and quality finance charges are key considerations for buyers.

Market Research Overview

The used car market in the UK is a significant sector, encompassing various types of vehicles including Hatchbacks, Sedans, and Sports Utility Vehicles (SUVs). This market is divided into organized and unorganized segments. The organized segment includes franchised dealers, franchise dealership networks, leasing offices, car subscription services, and auto marketplaces. On the other hand, the unorganized segment comprises independent dealers, individual garages, and unorganized dealerships. Used cars are available in various fuel types such as Petrol, Diesel, Hybrid, Electric, and Compressed Natural Gas (CNG)-powered vehicles. The market caters to various segments, including Luxury Vehicles, Mid-sized, Compact, SUV, and Electric vehicles. The market is influenced by several factors such as residual value, quality finance charges, emission standards, and fuel prices. The average ownership duration is decreasing due to the rise of online retailing and car subscription services. Artificial intelligence and machine learning technology are increasingly being used in used car management, enabling better assessment of vehicle condition and history. The market is also witnessing the emergence of Off-lease vehicles and the growth of online sales channels. The UK used car market is served by various players including automobile manufacturers, banks, NBFCs, insurance companies, and OEMs. The market is subject to various regulations and emissions standards set by the government.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

    --  Channel
        --  Organized
        --  Unorganized
    --  Vehicle Type
        --  Compact Car
        --  SUV
        --  Mid Size
    --  Type
        --  Petrol
        --  Diesel
        --  Others
    --  Geography
        --  Europe

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

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