Auto financiers said that the used car rack rate, which used to be 400-500 basis points (bps) higher than new cars even two years ago, is now down to around 250-300 bps higher. New car interest rates came down by 60-70 bps in the last one year.
In 2016, auto classified portals began allocating their capital towards expansion or scaling their operations, developing sustainable technology and hiring and retaining talent. But most of them could not reach the stage of profitability due to their inability to actively monetize their business.
The used car market has come to a screeching halt, hit hard by the demonetisation drive. According to auto financiers and organized used car sellers, demand has dropped by anywhere between 30% and 40% after the announcement.
Mahindra First Choice Services (MFCS), a wholly owned subsidiary of Mahindra & Mahindra, is a chain of multi-brand car workshops across major cities in India.
Used car players like Mahindra First Choice Wheels, online portals like Cartrade/Carwale and Droom have all witnessed an uptick in demand with both two and four-wheelers showing growth .
The company is in the process of engaging an investment banker for the fundraising and will be reaching out to venture capital and private equity investors to sell a stake, people in the know said.
"We are present in 360 towns including metros, mini-metros and smaller towns... this fiscal year, we want to end at about 1,500 outlets from 800 we have at present, which is a pretty rapid pace of growth," the company's CEO and Managing Director Nagendra Palle said.
Mahindra First Choice Services will inaugurate three more workshops in West Bengal over the next month, in Jalpaiguri, Kankinara and Berhampore. The company plans to set up 20 such workshops in West Bengal by March 2017.
MFCS will operate through its 3 hubs based in Bhopal, Indore and Jabalpur,where it will be scaling up operations through multiple workshops.
MFCS’ aim is to establish 30 multi-brand car workshops in UP by March 2016.
US-based digital marketing company Cox Automotive has acquired a significant strategic stake in Mahindra First Choice Wheels, the used-car retailing unit of Mahindra & Mahindra
The recent shift in consumer preference to fish for deals online, has forced car dealers to increase their online presence as well.
The Indian used cars industry is less than even 10% in size to that of the US used cars industry. The US used cars industry with 45 million cars is flush with a lot of money.
"The after-market car service industry is presently having a size of Rs 20,000 crore. Out of this, half is taken away by the local garages," said Mahindra First Choice CEO YVS Vijay Kumar.
The company is looking to enter the big league with a $15 million funding that it is hoping to raise in a few weeks. It is already testing waters in the four-wheeler segment and hopes to be present there as well in a couple of months
Mahindra First Choice Wheels, multi-brand used-cars offering from the Mahindra and Mahindra stable, is eyeing a significant increase in its share in used car market.
The primary aim of the association is to ensure another security checkpoint for automobiles listed on Droom. Mahindra’s AutoInspekt will perform auto inspection for used cars and two wheelers
Indian used car buyers are mostly not brand loyal. Only 16% of the used car searches are for specific brands, and 84% queries are generic queries indicating that the buyers get into the market with an open mind and finalise their purchase after analysing and researching all options.
A cluster of the franchise will be developed and a cluster warehouse will be set up in Jaipur in next one or two months and it will cater to these workshops.
Loyalty program firm Payback has tied-up with Mahindra First Choice Services (MFCS) to provide loyalty points for car servicing and repairs. This partnership marks Payback’s strategic entry into the Rs 15,000 crore Indian automotive aftermarket service industries.
| Name | DIN | Designation | Date of joining | |
|---|---|---|---|---|
| Chandrasekar Kandasamy | 1084215 | chandrak0801@gmail.com | Director | 24 Mar,2008 |
| Anupam Thareja | 1091533 | at@phicapital.in | Director | 15 Sep,2008 |
| Ruzbeh Baman Irani | 1831944 | ruzbeh.irani@gmail.com | Director | 15 Sep,2008 |
| Prince Mulapampallil Augustin | 2336637 | prince.augustin@hotmail.com | Director | 15 Sep,2008 |
| Vivek Nayer | 3410053 | vivek_nayer@msn.com | Director | 11 Mar,2011 |
| Venkata Satya Vijay Kumar Yegireddi | 3588223 | yvsvijaykumar@gmail.com | Wholetime Director | 04 Aug,2011 |
| Debabrata Bandyopadhyay | 6972463 | debu.bandyopadhyay@gmail.com | Director | 22 Oct,2014 |
| Hemant Sikka | 922281 | hsikka1968@gmail.com | Director | 19 Feb,2018 |
| Sonu Halan Bhasin | 2872234 | sonubhasin@gmail.com | Director | 22 Oct,2014 |
| Ramesh Ganesh Iyer | 220759 | iyer.ramesh@mahindra.com | Director | 15 Sep,2008 |
| Rajeev Bidyanand Dubey | 104817 | rajeevdubey.mahindra@gmail.com | Director | 24 Mar,2008 |
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