Used-car buyers drive India's mobility shift, with first-time owners powering market growth: Autocar India-Spinny report
New Delhi, June 27
India's used-car ecosystem is emerging as the dominant gateway to vehicle ownership, with first-time buyers, rising financing and SUV demand reshaping mobility preferences, a new report revealed. The Mobility Intelligence Report 2026, unveiled by Autocar India and Spinny, analysed over 11,000 transactions across nine cities to map the forces driving the sector.
According to the report, 80-82 per cent of used-car buyers are first-time car owners, "underscoring the category's role as the primary gateway to vehicle ownership for millions of Indians." The study estimates India's used-car market is 1.39 times the size of the new-car market and is growing at 11-13 per cent annually, while the organised used-car segment is expanding at more than 20 per cent annually.
Autocar India and Spinny said financing has become a key enabler of this growth. "Used-car financing penetration has doubled from approximately 16 per cent to 32 per cent over the past five years," the report noted, adding that nearly 60 per cent of transactions on organised platforms are now financed. Easier access to credit is helping buyers purchase higher-value vehicles and accelerating ownership decisions, according to the companies.
The report highlighted a shift from affordability-led to aspiration-led demand. "Instead of purchasing entry-level new vehicles, many consumers are opting for larger, better-equipped used vehicles within the same budget," Autocar India and Spinny said. SUVs continue to lead demand across urban markets, while automatic vehicles now account for 37 per cent of transactions, reflecting growing preference for convenience and urban drivability.
On ownership economics, the study found that a one-year-old vehicle depreciates by an average of 21 per cent, three-year-old vehicles by 33 per cent, and five-year-old vehicles by 41 per cent while retaining nearly 60 per cent of their original value. "This reflects how used vehicles are increasingly enabling consumers to access more premium segments without bearing the steepest years of depreciation," the report stated.
Brands such as Maruti Suzuki, Hyundai, Kia and Mahindra showed strong value retention, with models like the Maruti Baleno, Hyundai Venue, Kia Seltos and Mahindra XUV700 among the best performers, according to Autocar India and Spinny.
The report also flagged EV resale as a major emerging challenge. "Unlike internal-combustion vehicles, electric vehicles currently lack predictable resale benchmarks due to rapid technological evolution, concerns around battery health and changing consumer expectations," the companies said.
Commenting on the findings, Hormazd Sorabjee, Editor, Autocar India, said, "The used-car market today offers one of the clearest windows into how mobility preferences are evolving in India... As the market continues to mature, such data becomes increasingly important for consumers, manufacturers, financiers and the broader automotive ecosystem."
Niraj Singh, Founder and CEO, Spinny, added: "India's used-car market is undergoing a structural transformation. What was once viewed primarily as a value-driven purchase is increasingly becoming a pathway to first-time ownership, aspirational upgrades and smarter financial decision-making."
— ANI
Reader Comments
The shift from 'affordability-led to aspiration-led' demand is exactly what I see in Bangalore. Many of my colleagues are skipping entry-level new cars and buying pre-owned SUVs like the Kia Seltos or Mahindra XUV700 within the same budget. It's smart—you get more features, comfort, and space for the same money. But I have a concern: the EV resale challenge is a real elephant in the room. If battery tech evolves fast, who'll buy a used EV in five years? Need clarity on that from manufacturers.
Interesting data. In the US, used cars have been the norm for first-time buyers for decades, so it's good to see India catching up with organised platforms like Spinny. The 11-13 per cent annual growth seems conservative—given the middle-class boom and urbanisation, I'd expect even faster uptake. The automatic transmission trend (37 per cent) also mirrors Western markets where convenience trumps manual control. But the depreciation notes are crucial: losing only 21 per cent in the first year is decent, and brands like Maruti and Hyundai holding value is reassuring.
I respect the report, but I'm a bit sceptical of the 'aspiration-led' narrative. While it's true that used cars offer better value, many first-time buyers in smaller cities still prioritise affordability over features—I see this in my hometown in Uttar Pradesh. The financing push is good, but interest rates on used-car loans can be 2-3 per cent higher than new cars, so the total cost matters. Also, 60 per cent of transactions on organised platforms being financed might skew the data—unorganised sector is still huge. A balanced view would help.
As a first-time car owner in Chennai, I can vouch for this trend. Bought a used Maruti Baleno last year—save on depreciation
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.