The luxury car market in India has progressed at a steady rate post-2015. Flexibility in tax structures, better financing facilities, and growing competition has made more options available in the market in terms of both brand and variants. Luxury car manufacturers started exploring the possibilities of sales in the cost-sensitive Indian automobile environment as early as 2008. Before that, it was only Mercedes that had a strong footing in the country.
The younger generation today now demands more out of their vehicles. They want the best features at the best price too. Earlier the luxury car segment was limited to big businesses and corporates. The transition started when BMW introduced the entry-level 3-series sedan at an affordable price back in 2008.
Fast forward 10 years, the luxury car market has expanded both in width and depth due to the constant efforts of global carmakers to penetrate into this market. They understand that with the diversity of needs, they must be ready with a variety of products to match the requirements. Similarly, the used luxury car market also gained momentum, because why not?!
Indian customers are smart and are given to save as much money as they can by habit. This is another factor why the used luxury car sales and brand new car sales go hand in hand. People look for better deals in the majority of purchases they make which drives the overall market sentiment. As far as deciding to go for either brand new or used luxury car is concerned, we will examine the pros and cons before trying to reach an impartial conclusion.
Buying a luxury car is a dream
Who doesn’t want to own a luxury car? Swanky design, top-of-the-world luxury features, quality, and reliability make these cars a complete package. Whether you want to make a statement in your corporate circle, or just want to enjoy a carefree long drive on the open road, a luxury car has it all. These expensive machines are built to last and outperform any competition whatsoever. The craze for luxury cars is not new in India. In recent times this love has become more pronounced than ever thanks to social media campaigns by the companies as well as peer-to-peer interaction.
If you know someone who owns a luxury car, you would straightaway enquire about the specifications and features these beasts have on board and would want to have a ride too. Such is the enigma around these vehicles that they attract people of all classes, age, and gender, race equally. It is often a dream for many people to own a luxury car for a variety of reasons:
- Status symbol
- Business development
- Advanced features
- Premium luxury
- Quality and reliability
Why should you choose a used luxury car
The average Indian customer gives preference to the cost of the product above anything else. Now in recent times when the competition has increased manifold, the Indian luxury car market is flooded with options for the customers. Keeping this in mind, the most important reason why you should get a used luxury car is affordability. You can get a good bargain if you look hard as compared to shedding a huge amount of money for a brand new car.
Apart from this, with the emergence of national dealers like Mahindra first Choice Highline and Big Boy Toyz, purchasing a used luxury car has become easier than ever. They take care of all the paperwork and also provide extended warranty for selected brands and models. The presence of actual professional and skilled personnel in this particular segment has certainly given a huge push to the sales figures in India.
Why should you choose a brand new luxury car
A brand new luxury car is upgraded than its predecessor and comes loaded with more advanced safety features. The software is better, the latest emission norms are followed and the product is manufactured through processes that have evolved over more than nine to ten decades. A brand new luxury car is no doubt expensive but is sure to keep that adrenaline gushing every time you step into the car.
Upgraded versions of the existing models are being rolled out more frequently by luxury car manufacturers to stay head-to-head with their competitors. With technology evolving at lightning speed, you wouldn’t want to miss out on the latest gadgets on-board your new luxury ride.
Comparison between a used luxury car and a brand new luxury car
Advantages of buying a used luxury car
When it comes to a used luxury car, the purchase must be made only after thorough background checks and pre-purchase inspections. The number of used luxury cars is growing rapidly in the market due to frequent rotation by brand new car buyers. While there are a number of factors that have to be considered before committing to a purchase, there are a lot of advantages of buying a used luxury car:
- A 3-4-year-old luxury car can be bought at half the price of a new one due to depreciation
- You can always use different vehicles before finally making the decision of buying a brand new luxury car for long term
- Extended warranty options help to maintain these cars easier
- The insurance cost goes down drastically as it is calculated as per the current value of the car
- Cars sold by institutions are often in perfect stock condition and give the same experience as a new one
- Software updates by many companies make it easier to drive these machines without paying anything extra
- The reliability factor comes in when choosing between a luxury car and a premium car
Advantages of buying a brand new luxury car
A brand new luxury car comes at a premium price and it is, without doubt, a dream come true for a die-hard car enthusiast. There’s a large customer base in the luxury car segment that gives utmost importance to luxury and comfort. Additionally, for high-value customers, luxury car manufacturers also build safer and more advanced vehicles. The option of customizations makes it all the more rewarding experience. There are a number of advantages of buying a brand new luxury car:
- Latest upgrades in features and software; along with improved electronics
- Latest emission norms for a cleaner driving experience
- Advanced safety and security features are added that were not even invented a few years back
- Enhanced dealership and service center network means easy availability of parts and services
- Easy financing options allow for smoother purchase and re-sale after a few years
- Better connectivity and error diagnostic tools available in the newer models
Disadvantages of buying a used luxury car
There are a number of disadvantages associated with buying a used luxury car that is often ignored by customers. As we discussed the pros in the previous sections, let’s now look at the cons:
- High maintenance costs for high-end luxury cars
- The availability of spare parts sometimes becomes quite difficult because of technology becoming obsolete in a matter of few years
- Higher fuel consumption as the vehicles are designed on old norms
- Higher emissions too for the same reason as above
- The resale value of the used luxury cars is very minimal
- Software upgrades are available on only select models, hence it is not worth driving an outdated car
- The used luxury car requires frequent visits to the service centers if not used judiciously
- Additional features and benefits come at a higher price and it is not recommended to modify the vehicle in any manner
- There’s no warranty period left on used luxury cars, hence costs for repairs especially can go up
Disadvantages of buying a brand new luxury car
A brand new luxury car is sure to turn heads wherever you go, but often with great luxury comes a variety of other issues that are often ignored just for the sake of the former. Let’s take a look at the flip side of buying a brand new luxury car:
- A brand new luxury car depreciates as soon as you buy it, and often the depreciation goes up to 30% in the first few years of use
- You’ll always have to pay extra for excise and custom clearances if the vehicle is not manufactured in India
- Since there’s not a lot of changes in terms of features in some brands, it is not worth spending a huge amount of money on a luxury car
- Newer vehicles are supposedly less durable as companies often compromise on quality over cost of production
How used luxury car market is grown in recent year and its future scope
The used luxury car market in India has grown unexpectedly and post the Covid-19 pandemic, it is bound to grow steadily. There’s enough evidence to believe that the sales figures of the used luxury car segment will outperform the brand new luxury car segment due to the affordability of these vehicles. The ongoing economic slump is another major factor why the purchasing power of the average car buyer has gone down. More people are definitely looking to buy cars because of the strict social distancing norms in place. That is all the more reason why the demand for luxury cars is going to increase. Luxury cars provide the reliability and safety that very few automobiles have to offer. People are on the lookout for durable pieces of machinery that would last long and not hurt their pockets much.
Altogether, the year-on-year growth rate for the used luxury car market is expected to be around 8% in the upcoming years (2022 to 2027). The huge surge in demand is well facilitated by the entrance of new exclusive dealerships that deal in used luxury cars’ sale and purchase. The added benefit of the extended warranty, rigorous inspections, and tests, certification of health and endurance as well as insurance offers is giving a boost to the sales. Thus the future of the used luxury car market seems bright in India.
Whether you should choose a used or brand new luxury car
Ultimately, it is the end-users who have to decide for themselves while choosing a luxury car. We have tried to clarify the differences between a used luxury car and a brand new one to offer a clear perspective to the customers. The need for either of the two differs from region to region and socio-economic conditions of the customers. There’s no doubt that both the sections have their own pros, but the cons must be carefully considered before opting for one.
The ground reality differs from location to location. Consumers in Tier II and III cities in India are most likely to go for a used luxury ride to experience the taste first. The new user is smarter now and wants to try their hands on a used car and then opt for a brand new car later.
While luxury cars are sure to remain the most prestigious machines in the world, their functionality and capabilities are limitless. These factors cumulatively impact the sales figures and user preferences in the long run.