I have been seeing the progressively reducing demand in the Indian second hand / used car markets. About two and a half decades back, demand for cars were more and very few choices were available. The production controls and the lesser number of models available made it a Hobson's choice. Almost all cars had waiting lists for a few months to a few years. These cars commanded unofficial premiums payable to the person who had booked one, if one had to buy urgently.Its but natural that second hand car markets had to flourish and an used two year old car sold at almost the same price as the new one. The new ones had premiums on their price tags due to the waiting lists. Car loans were few and tough to come by.
Today the scenario is totally different. Loans are plentifully available for new cars. Production is at an all time high. The model range is wide right from Bentleys, Rolls and Mercs to the tiny Maruti Suzuki Alto. India is among the world's top ten nations car production wise. So most people prefer new cars over the used ones. The used car prices have plummeted. The car straight way loses 20 to 30% of its showroom price in the first year and more in later years. The resale depends on a car's brand equity and durability. But financiers have their ways and demand higher interest rates for second hand cars. So its easier to buy a new car with very little initial investment (only about 10%), the rest being in the form of a loan. For a second hand car one has to invest about 50% of its price and the rest is a loan.
What is the scenario in the UK or in other countries in Europe?