Junglee is offering pre-owned cars and two wheelers to customers from its website. The portal promises to offer consumers in 160 cities across the country a choice of 25,000 vehicles. Evidently, this will encourage sales in the automobile segment along with widening the range of products offered by e-tailers. Junglee is owned by Amazon, which could probably indicate that this ecommerce giant will expand its offering of automobiles in the near future.
Junglee’s general manager and director Mahendra Nerurkar explains this move, “We launched this category because we think there is a lot of price asymmetry in the second-hand car market and if we can provide users with quality cars, we believe there is a huge opportunity.”
Besides this ambitious goal, there are some hard facts that seem to have assured the profitability of this product category. According to research conducted by PricewaterhouseCoopers, The pre-owned car market has accelerated at a CAGR of 15% in the past three years to reach about half the size of the new car market, with sales of up to 1.6 million in a year.
Initially, consumers can buy used cars, bikes and scooters from Junglee. However they can only purchase from within their city only owing to the difficulties in getting a vehicle registered in a state other than where it is purchased. Another aspect is that consumers will not be able to compare prices of vehicles sold on online portals with those sold at the showrooms since most offline pre-owned sellers are not partnering with Junglee.
Being there, doing that
Junglee isn’t the first to plunge into the automobile category in the online retail space. Snapdeal had earlier tied up with Mahindra & Mahindra to offer the popular SUV Scorpio. Others like Gaadi.com and OLX have already been competing in this category for years now. This clearly indicates that this segment has a bright future in online retail. Also, it has fewer competitors at the moment in comparison with other product categories.
Any dealers who were wondering whether it is the right time to sell automobiles online, we think it’s time to hit the accelerator on your plans!