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The US Used Car Market size is estimated to grow by USD 35.96 billion at a CAGR of 4.14% between 2022 and 2027. The growth of the market depends on several factors such as the excellent value for money proposition of used cars, the reduced ownership cycle of cars, and the increasing technological innovations in passenger cars.
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Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The excellent value-for-money proposition of vehicles is driving growth in the market. The rising number of automakers entering the market and the quality of used cars is improving in the eyes of customers due to an increased number of online dealers. Customers choose to purchase a used car over a new car, primarily due to its affordability.
However, they are often skeptical of the quality of the used vehicle as the details regarding the previous ownership of the vehicle are often vague, and any damage to the vehicle after purchase would be void of warranty. The quality of the vehicle is usually guaranteed by a number of additional benefits provided when purchasing used cars. Thus, excellent value for money from used cars will drive the growth of the market in focus during the forecast period.
In the US, the market remains a significant driver within the automotive industry, buoyed by robust sales of pre-owned vehicles. With a plethora of options available, consumers are drawn to the diverse content and selection offered across dealership lots nationwide. This trend underscores the American penchant for value and variety in the used vehicle market. As a vital segment of the US automotive industry, used car sales continue to thrive, shaping the landscape of the US market. The resilient nature of the American consumer contributes to the market's sustained growth, reinforcing its position within the broader automobile industry.
The increased penetration of websites dedicated to selling cars is a key trend in the market. The increased penetration of the Internet has facilitated an efficient online marketplace in the US. Consequently, the growing penetration of online car sales websites has made it easier for customers to purchase a used vehicle using websites in the country. Such sites help sellers to reach a vast number of potential buyers.
Moreover, online car websites offer free or discounted after-sales service packages that cover various types of maintenance costs associated with the vehicle after purchase. The sale of cars in the US will be stimulated by more convenient ways to swap vehicles with other well-maintained vehicles through an online website. and will also drive the market growth and trends in focus during the forecast period.
The future outlook for the market remains dynamic, shaped by various factors including the pandemic's aftermath and evolving consumer preferences. The news indicates a surge in demand for pre-owned vehicles due to depreciation concerns and a limited inventory of new cars. Consumers prioritize trusted brands and certified vehicles, emphasizing quality and reliability. Dealerships adapt, enhancing online platforms for seamless transactions. Competition intensifies among brands, fostering innovation in financing and inspection services. Despite mileage concerns, a transparent vehicle history becomes pivotal. Trade-in opportunities rise, fueling the used car marketplace's growth. Overall, the car industry anticipates continued expansion, reshaping the automotive landscape in America.
The increasing preference for car subscription services is a major challenge faced by the market. The subscription model for cars is becoming increasingly popular among individuals who prefer personal transportation over time without having to invest and commit to a single-vehicle model for a more extended period. The car subscription model would allow a potential car buyer to choose any different vehicle model for a fixed period and miles.
Moreover, the car subscription business model covers all maintenance, vehicle insurance, and periodic service costs under the monthly subscription fee. The growing popularity of car subscriptions, as mentioned above, will harm market growth in focus during the forecast period.
The market trends and analysis report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the market growth analysis report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
AutoNation Inc. - The company offers the 2020 Acura MDX, 2019 Acura RDX, 2020 BMW 3 Series, and 2021 Chrysler 300.
The market report also includes detailed analyses of the competitive landscape of the market and information about 12 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The third-party channel segment is estimated to witness significant growth during the forecast period. The new US car market is highly competitive, with a large number of new vehicle models being launched every year. This, however, drives a steady supply of cars into the market. There is a substantial difference in used car prices compared to new cars.
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The third-party channel sales segment was the largest segment and was valued at USD 86.23 billion in 2017. The progressing number of new cars launched in the US car market will cause the average ownership cycle per car to reduce over the forecast period. This trend will be beneficial to car buyers because they would purchase vehicles that did not have significant use during the previous ownership cycle.
The market research and growth report forecasts market growth by revenue and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The Market is a significant segment of the automotive industry, characterized by robust vehicle sales and a thriving used car industry. The market encompasses various types of vehicles, including used vehicles, catering to diverse consumer needs.
The U.S. used-car market is driven by factors such as affordability, availability of a wide range of models, and the desire for cost-effective transportation. Used-vehicle sales in US contribute significantly to the automotive sector, reflecting consumer preferences for pre-owned vehicles. As the market continues to evolve, it remains a crucial component of the overall automotive industry.
Market Scope |
|
Report Coverage |
Details |
Page number |
129 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 4.14% |
Market growth 2023-2027 |
USD 35.96 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
4.0 |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
AutoNation Inc., CarMax Inc., Carvana Co., General Motors Co., Group 1 Automotive Inc., Hendrick Automotive Group, Hertz Global Holdings Inc., Lithia Motors Inc., Penske Automotive Group Inc., Sonic Automotive Inc., Vroom Inc., and Asbury Automotive Group Inc. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period. |
Customization purview |
If our market growth and forecasting report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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