Used car sales are sluggish, dealers "grit their teeth" and cut losses

If in the first months of 2022, the used car market became vibrant and bustling, even creating a "paradox" in prices, then in the last months of the year, everything is showing an opposite situation.

It can be said that the used car market is currently quite quiet. Many used car stores often sit idle for a whole month, and if they are lucky enough to find customers, they can only sell 1-2 cars.

Mr. Pham Thanh Tuan, owner of DCar Auto used car showroom in Hanoi, said that in fact, buying and selling activities have been slow since June, but now the used car market has truly "hibernated" as no one is buying.

The gloom of the used car market at the end of the year is rare.

The reason is that in the new car segment, many companies are continuously launching incentives and discounts to stimulate demand at the end of the year. That has had a strong impact on the used car market, especially in the segment of cars priced from 800 million to over 1 billion VND, where there are almost no customers.

Mr. Tuan added: “Most customers buy used cars through bank installment loans, but the interest rate used to be only 7-8%/year, but now it has increased to 13-16%/year. Not to mention, borrowers also have to pay an additional 30 million VND in insurance fees to get the loan disbursed, causing them to give up the idea of ​​buying a car.”

In the used car segment under 600 million VND, "national" car models such as Hyundai Grand i10, Toyota Vios, Honda City, Mazda 3, Kia Cerato from 2014-2019 are still sought after by many people because these are easy to buy and easy to sell.

Used car prices of Hyundai Santa Fe have been pushed higher than new car prices due to supply shortage.

“The used car segment worth billions of dong is currently considered to be ‘frozen’, while the segment of cars under 600 million dong can still be sold but will have to accept a loss to sell,” said Mr. Nguyen Tu, a used car dealer.

Anh Tu shared that "super-used" car models such as Hyundai Santa Fe, Toyota Raize or KIA Seltos, which used to have a period when the price of used cars was higher than that of new cars, have now returned to their actual market price when the supply of new cars is no longer in short supply as before.

Mr. Doan Dung from a used car trading site commented: “Many sectors are affected by the economic recession, especially the real estate sector. A large amount of money stagnated in this sector has had a significant impact on the trading of both new and used cars.”

According to research, at this time, customers buying used cars are mainly those who use their savings, but this group is not large. The main customer group is business people who are tightening their spending and having difficulty accessing bank loans. The gloomy transactions have made many used car dealers restless when capital is not circulating.

Transactions for used cars worth billions are almost non-existent.

“Currently, the price of new cars has decreased, and car buying shops cannot buy them back at high prices, so there are not many individuals selling cars, only a few people facing financial difficulties have to sell their cars. Previously, many shops had bought cars at high prices, so now they have no intention of importing more, not to mention having to accept losses to recover capital,” said a used car shop owner on Thanh Thai Street.

According to Mr. Dung, the used car market is expected to pick up at the end of December, but it will be difficult to explode like every year. For those who really want to buy a car, this will be a very good time to buy because the price of used cars is being offered lower than a few months ago by 20-30 million VND for the same car model.

According to Vietnamnet