Thailand Used Car Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Market Overview

Thailand Used Car Market was valued at USD 5.1 billion in 2021 and is expected to reach USD 8.3 billion in 2027 registering a CAGR of above 7% during the forecast period ( 2022 - 2027).

Though the impact of the pandemic is inevitable on the market due to lockdowns and travel restrictions in 2020, the impact is considered to be minimal. With the increased number of people preferring individual mobility and more finance options available in the used car market, the market started growing considerably since the first half of 2021. For instance,

• In 2021, CarTrust company switched its business model from mainly financing to providing credit and refinancing for buyers of second-hand cars. Its major business involves lending to car hire-purchase customers looking to repay their remaining debts so that they get the vehicle registration to be used in their application for refinancing.

Thailand is expected to emerge as one of the high potential used-car markets during the forecast period in wake of a widening customer base and notable improvements in the buying patterns of used cars out of concerns over health in wake of recent incidences like the pandemic. Growing new entrants and strong presence of B2C and OEM Dealerships, especially the OEMS like Toyota and Honda, to further enhance growth of market during the forecast period.

In addition, rising internet penetration and online platforms for used cars to facilitate easy buying and transfer of used cars to the customers is also expected to drive demand in the market. However, 7% VAT added to the bill if the customer buys from a showroom or used car dealer, or use a loan to finance the purchase, likely to act as potential challenge.

Bangkok,Phuket, Chiang Mai, and others likely to stand as attractive destination for used car dealers as these provinces accomodate higher purchasing power individuals as compared to other regions. The Northeastern region has the second highest used car sales volume due to strong economic growth from increasing cross-border trade supported by the presence of special economic zones.

Scope of the Report

A used car, a pre-owned vehicle, or a second-hand car, is a vehicle that has previously had one or more retail owners. Used cars are sold through various outlets, including franchise and independent car dealers, rental car companies, buy here pay here dealerships, leasing offices, auctions, and private party sales. Some car retailers offer "no-haggle prices," "certified" used cars, and extended service plans or warranties.

The scope of the report covers details on the latest technologies, trends, and developments in the market. Thailand's Used Car Market is segmented by Vehicle Type, Vendor Type, Booking Type, and Fuel Type. By Vehicle Type, the market is segmented into Hatchbacks, Sedans, and Sports Utility Vehicles (SUV) and Multi-Purpose Vehicles (MPVs).

By Vendor Type, the market is segmented into Organized and Unorganized. By Fuel Type, the market is segmented into Petrol, Diesel, and Others. By Booking type, the market is segmented into online and offline. For each segment, market sizing and forecast have been done on basis of value (USD billion).

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Key Market Trends

Rising Internet penetration and Online Digital Platforms to drive demand in the Market

Consumers are shifting away from traditional methods and increasingly using online platforms for their used car buying/selling journey. Many start-ups and auto portals present in Southeast Asia are entering the Thailand market or expanding their presence through Collaborations, mergers, and acquisitions to capture the growing industry potential. For instance,

• In 2021, CARS24, an Indian Autotech unicorn, announced that it is expanding its foothold in Thailand as part of its international expansion plan in Southeast Asia. The company plans to capture the used car market in Thailand which is likely to be driven by an increased preference for personal safety and the better economic viability of purchasing used cars in coming years.
• In 2022, One2Car.com, one of the three websites of iCar Asia Thailand, announced to expand its offerings into a one-stop channel that covers the complete automotive market. That includes buying, owning, and selling used and new cars.

Increasing internet and smartphone penetration in the country has resulted in large number of consumers preferring to buy and sell cars through online auto classifieds and social media. For instance, there were 54.5 million internet users in Thailand in January 2022, accounting 77.8% of the total population. In 2021, 36.8 million people in Thailand engaged in digital payments with total payment transactions of USD 19.3 billion, registering 35.5% year-on-year growth. Further, around 36.6 million people purchased consumer goods (includes Used cars ) via the internet in 2021, up by 8.7% year-on-year growth. About 56.8 million people engaged in social media, accounting for 81.2% of the population, while there were 95.6 million cellular mobile connections in Thailand, or 137% of the population, in January this year.

Auction Houses are also increasing their spending on online advertising and generating leads through these platforms. According to reports published in accordance with google trends 2021 indicate that the market has gained more attention. Searching for major second-hand car brands on the Internet increased in the past two years.

Aforementioned developments are anticipated to indicate positive outlook for Thailand used car market, especially the growth of online segment, during the forecast period.

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