Online Car Buying Market is Poised to Accelerate at CAGR of 12.58% to Reach USD 885.1 Billion By 2032: Astute Analytica
Online car market is booming, with North America leading the charge driven by consumer preference for digital tools and pandemic-accelerated dealership adaptations. Online sales are increasing for both new and used vehicles, particularly EVs. While dealerships remain relevant, buyers demand a streamlined, transparent experience with greater online integration for research, financing, and even purchase completion.
New Delhi, April 08, 2024 (GLOBE NEWSWIRE) -- According to Astute Analytica, the global online car buying market is projected to reach US$ 885.1 billion by 2032 from US$ 304.7 billion in 2023 at a CAGR of 12.58% during the forecast period 2024–2032.
The online car sales industry is booming, transforming the automotive shopping journey. By 2025, online transactions are predicted to claim 30% of global vehicle sales, marking a significant surge from just 5% in 2022. This showcase that consumer attitudes are shifting rapidly. A 2023 survey, for instance, found that 80% of car buyers are open to the idea of purchasing online. Another study reveals that online options could even accelerate decisions, with 25% of buyers indicating they'd purchase sooner if the process were digitized.
*Request Free Sample Copy @ https://www.astuteanalytica.com/request-sample/online-car-buying-market*
China leads in online sales volume in the Asia Pacific online car buying market, reaching 2.2 million units transacted online in 2022, reflecting a 28.3% year-on-year increase. Online sales now represent 12% of China's total passenger vehicle market. Europe isn't far behind, with online sales projected to hit 25% of total sales by 2025. UK-based platforms like Cazoo are thriving, achieving a 100% sales increase to over 65,000 cars in 2022. Similarly, US used-car retailer Carvana enjoyed a 6% annual boost, selling 412,296 vehicles in 2022.
A 2023 survey reveals 67% of buyers like the hybrid model: choosing a vehicle online and finalizing at a dealership. Extensive online research precedes most purchases, with 81% of shoppers engaging in digital research, typically investing over 12 hours before committing (Google, 2022). Interestingly, a 2023 Autotrader study shows 59% of buyers are receptive to fully online experiences, including financing, paperwork, and home delivery. Moreover, automotive marketplaces are also flourishing - Cars.com's Q4 2022 stats show an increase in unique monthly visitors to 26.9 million and CarGurus' 2022 revenue surged a massive 123% to $1.66 billion.
Astute Analytica’s study suggests that the online car buying market is on a remarkable growth trajectory. As buyer preferences evolve, platforms providing convenient, research-backed, and fully online purchase experiences will be best positioned to dominate in this exciting and lucrative sector.
*Key Findings in Online Car Buying Market *
Market Forecast (2032) US$ 885.1 billion
CAGR 12.58%
Largest Region (2023) North America (33.8%)
By Car Ownership Used Cars (73.9%)
By Car Category Passenger Car (84.6%)
By Propulsion Type ICE (74.5%)
By Sales Channel Aftermarket (77.7%)
Top Trends · Increasing adoption of electric vehicles (EVs) in the online car buying market
· Growing popularity of crossover SUVs and hatchbacks among online car buyers
· Integration of advanced safety features, connectivity technologies, and infotainment systems in vehicles sold online
Top Drivers · Convenience, transparency, and a streamlined purchase process offered by online car buying platforms
· Pandemic-driven acceleration of digital tools adoption by dealerships and consumers
· Evolving consumer preferences towards fuel-efficient, eco-friendly, and technologically advanced vehicles
Top Challenges · Lack of skilled talent to capture value from emerging automotive technology trends
· Intense competition among key players vying for market share in the entry-level luxury car segment
*Online sales of Used Cars is Flying Higher Than New Cars, Generate Over 73% Market Revenue *
Online car buying market is skyrocketing within the used car segment, outpacing the growth of new car sales. This digital transformation smooths the process and allows more people to buy and sell used vehicles across borders. European online marketplaces like AutoScout24 and Mobile.de are booming. Meanwhile, China's 2022 online used car transactions soared to 2.2 million units, marking a 28.3% annual increase. India's online pre-owned car market is set for explosive growth with a projected CAGR of 11% from 2021-2030, led by platforms like Cars24 and Droom. Even Latin America is riding this wave, with companies like Kavak rapidly expanding their presence across the region.
Buyer behavior heavily favors online channels. In the US online car buying market, for instance, 81% of used car buyers research and compare vehicles online before purchasing. Across the UK, 64% of buyers start their search online, and remarkably, 29% complete the entire transaction digitally. German used car buyers invest an average of 10.8 hours in online research, while 60% of Australian buyers are ready to embrace a fully online purchase experience. In Q2 2022, near-new vehicles represented 58% of dealer-sold used cars; that share decreased to just 49% in Q2 2023. This trend forces buyers to consider older models: the average vehicle age in the US is now 12.5 years.
Sellers are adapting rapidly. Online retailers like Carvana and Vroom have seen explosive growth, while traditional dealerships increasingly offer online purchase options. Peer-to-peer marketplaces like Facebook Marketplace facilitate private transactions. An emerging trend is the used car subscription model, with services like Fair and Clutch gaining attention. Due to supply constraints and strong demand in the online car buying market, used car prices are elevated globally compared to pre-pandemic times. In the US, the average used car transaction price in Q2 2023 was a staggering $29,472, a 46% increase from Q2 2018. While some markets show signs of stabilizing prices in 2023, used car affordability remains a challenge.
Other intriguing market facts bolster the online story. SUVs and crossovers are the fastest-growing used car segments across the globe. Electric vehicles are gaining popularity as their pre-owned availability increases. Online financing and insurance options streamline the digital experience. Unsurprisingly, over 60% of online used car shopping in some markets happens on mobile devices.
*Ask Questions Before Purchasing @ https://www.astuteanalytica.com/inquire-before-purchase/online-car-buying-market*
*Online Buyers are Increasingly Moving to Electric Vehicles, But ICE Dominates Online Car Buying Market, Control 74.5% Revenue Share *
The online electric vehicle (EV) market is accelerating rapidly. Sales in the US surged by 22% in 2022, with China and Europe showing even stronger growth at 35% and 28% respectively. Globally, online EV sales are expected to maintain an impressive CAGR of 29% from 2023-2028. EVs are gaining online car buying market share, accounting for 25.5% of all online vehicle sales worldwide in 2023, a significant jump from 3.2% in 2018. Younger generations are driving this trend, with Millennials and Gen Z representing 62% of online EV buyers worldwide. In the US, the average online EV buyer is 38, compared to 47 for ICE vehicle online buyers. The gender split remains somewhat uneven, with 68% of online EV buyers being male.
The Tesla Model 3 dominates online EV sales in worldwide online car buying market, while the Wuling Hongguang Mini EV reigns supreme in China, and the Volkswagen ID.4 leads the European online EV market. Despite rising costs, online EV prices remain relatively stable. In 2022, they averaged $52,500 in the US, €45,000 in Europe, and ¥180,000 in China, with minor annual increases between 3-6%. Inventory is improving, with the US seeing a boost to 28 days supply in Q4 2022, while China holds the highest supply at 42 days.
Our study on the online car buying market reveals online buyers prioritize range, with a global average of 298 miles. US buyers desire slightly more (322 miles), while Chinese online sales often involve models averaging 255 miles. Financing remains popular, with 72% of global online EV purchases leveraging loans. In the US, the average loan term is 69 months. Interestingly, a higher percentage of Chinese online EV buyers (58%) opted for cash purchases in 2022.
*North America and Europe are Leaders in Online Car Buying Market with 60% Collective Market Share, But North America Remains at Forefront *
North America, particularly the U.S., stands as the powerhouse of the online car buying market. This dominance stems from evolving consumer preferences, pandemic-driven adaptations, and a strong appetite for digital tools throughout the car buying process. A significant 57% of U.S. car buyers were satisfied with the experience in 2022, representing a 10% increase from the previous year as dealerships embraced online processes. Car buyers in the U.S. demonstrate a high degree of online engagement, spending 59% of their research time on digital platforms. Additionally, 46% use multiple devices during this phase, showcasing a seamless approach. Interestingly, 6 out of 10 buyers are open to multiple vehicle options when beginning their search, indicating that online tools facilitate wider comparisons. Third-party websites play a dominant role, utilized by a staggering 78% of U.S. shoppers for researching prices, finding cars for sale, comparing models, and determining trade-in values.
Online car buying platforms like Carvana have gained significant traction, positioning themselves as leaders in the U.S. market. CarMax and Carvana were among the top online car retailers globally in 2023. Despite this digital surge, traditional dealerships still play a role as over 50% of U.S. shoppers initiate contact by walking in. Financing stands as another area where U.S. buyers seek more online integration, with 55% expressing dissatisfaction with lengthy dealership paperwork. Buyers in the online car buying market who complete more than 50% of the process online are more likely to feel satisfied with the deal, further highlighting the appeal of digital tools. Interestingly, 54% of U.S. car buyers would pay more for a better experience, suggesting a market primed for innovation and disruption of the traditional dealership model.
Digital influence remains undeniable, with 95% of U.S. buyers using online resources and twice as many starting their research digitally versus at dealerships. Online videos play a key role, with over 70% of shoppers using them for product knowledge. Mobile searches for reliable cars have soared by 70% in two years. While today's sales still mostly close at dealerships, the undeniable trend is towards a predominantly online purchase journey.
*Global Online Car Buying Market Key Players*
· AAA Auto Export
· AUTO BEEB
· AUTO1.com GmbH
· autolina.ch ag
· AutoScout24
· Cars4Europe
· comparis.ch AG
· Copart
· DAT AUTOHUS AG
· JP Motors Nissan
· MG Motors
· Reezocar
· szbk.pl
· Webmotors S.A.
· Other prominent players
*Key Segmentation:*
*By Car Ownership*
· New Car
· Used Car
*By Car Category*
· Passenger Vehicles
· Hatchback
· Sedan
· SUV
· Light Commercial Vehicles
· Pick Up Trucks
· Vans
*By Propulsion System*
· Electric Vehicles
· Internal Combustion Engines
· Natural Gas
· Hybrid
*By Sales Channel*
· OEMs
· Aftermarket
*By Region*
· North America
· Europe
· Asia Pacific
· Middle East & Africa
· South America
*Request Research Methodology @ https://www.astuteanalytica.com/request-methodology/online-car-buying-market*
*About Astute Analytica*
Astute Analytica is a global analytics and advisory company which has built a solid reputation in a short period, thanks to the tangible outcomes we have delivered to our clients. We pride ourselves in generating unparalleled, in depth and uncannily accurate estimates and projections for our very demanding clients spread across different verticals. We have a long list of satisfied and repeat clients from a wide spectrum including technology, healthcare, chemicals, semiconductors, FMCG, and many more. These happy customers come to us from all across the Globe. They are able to make well calibrated decisions and leverage highly lucrative opportunities while surmounting the fierce challenges all because we analyze for them the complex business environment, segment wise existing and emerging possibilities, technology formations, growth estimates, and even the strategic choices available. In short, a complete package. All this is possible because we have a highly qualified, competent, and experienced team of professionals comprising of business analysts, economists, consultants, and technology experts. In our list of priorities, you-our patron-come at the top. You can be sure of best cost-effective, value-added package from us, should you decide to engage with us.
**Contact us:*
Vipin Singh
BSI Business Park, H-15,Sector-63, Noida- 201301- India
Phone: +1-888 429 6757 (US Toll Free); +91-0120- 4483891 (Rest of the World)
Email: sales@astuteanalytica.com
Website: https://www.astuteanalytica.com/*
CONTACT: Vipin Singh
BSI Business Park, H-15,Sector-63, Noida- 201301- India
Phone: +1-888 429 6757 (US Toll Free); +91-0120- 4483891 (Rest of the World)
Email: sales@astuteanalytica.com
Website: https://www.astuteanalytica.com/