German luxury automobile major Audi is ramping up its pre-owned car business Audi Approved Plus to enable buyers in India to upgrade without having to spend on a new luxury car.
“For our Audi Approved Plus brand, we moved from seven facilities in 2020 to 14 in 2021 and now, we are moving to 20 by the end of this year,” said Balbir Singh Dhillon, head of Audi India in an interview.
On the emphasis on this business, he said “In the last few years, the prices of new cars have continuously gone up and of late, the pressure on car pricing is even more due to the increase in commodity prices, shipment costs and foreign exchange rates.”
“It has widened the gap between the non-luxury segment and the luxury segment. When the gap has widened, potential customers fall into this gap and this is where Audi Approved Plus comes into the picture,” Mr. Dhillon explained.
With Audi Approved Plus, the company was trying to bridge that gap, he added.
He said for customers for whom affordability of a new car is a challenge at this point in time, they can still experience the luxury segment with the pre-owned car.
Highlighting that between 2020 and 2021 the company’s pre-owned car business grew by 39%, he said there has been a 50% jump in the first quarter of 2022 compared with the year-earlier period.
To cater to the growth, the company has increased it manpower by 50% between 2020 and 2021 across the country, he said.
Emphasising that the growth in the pre-owned car business is consistent, he said organised players were taking the lead in the pre-owned car business as they have brought transparency to the business.
The company, Mr. Dhillon said, has increased its investments in Audi Approved Plus business by 30% in 2021 compared with 2020.
“We have more than 150 cars available on our portal across the country. We offer a lot of choices for the customers and it is a complete online buying experience for them,” he added.
A large part of the demand for the luxury pre-owned car segment comes in the ₹20 lakhs-₹1 crore price bucket, he said adding, “The challenge that we face is the supply of the pre-owned cars as the demand is much more than what we are able to get from our customers.”
He said during the pandemic, the ownership periods had become longer and people were not selling their cars frequently.
“This is creating much more demand and we are reaching out to all potential customers to see whether they want to sell their car or buy a new car,” he added.
The company now wants all its dealers to offer pre-owned cars as well. “Perhaps, we can look at having more pre-owned car showrooms than our new car showrooms,” he said.