Used car market hopes to use online platform to develop further

With the used automobile market in China not nearly as good this year as in previous ones, many car dealerships are looking to branch into different channels, including the online market.

In the US and European markets, used car sales are equivalent to 20 percent of the total amount of automobiles on their roads. The used car sales markets in those countries are over twice as large as the new car markets in those countries. However, in China the used car sales market is only one fourth of the size of the new car sales one, meaning there is a great deal of development potential remaining.

However problems with quality, troublesome government policies aimed at limiting vehicle registrations and lack of innovative players in the industry are still major obstacles to the used car market's development.

In response to this situation, dealerships are trying to take advantage of online services to help them boost used car sales. The number of online platforms specializing in used vehicle sales has grown considerable over the past few years.

The used vehicle market in China is gradually transforming from a primarily consumer-to-consumer model, to more a complicated consumer-to-business, business-to-business and finally business-to-consumer process. Using online services, it is possible to obtain a vehicle without having to set foot in a dealership.

Sui Aning, CEO of gofull.com.cn, explains that online used car services offer financial and loan services for buyers, as well as funding for automobile manufacturers. Yang Zheng, board chairman and CEO of pahaoche.com.cn, explained that his company offers financial services for its consumers. Mr. Yang pointed out that these services are aimed at helping expand the scales of the used car market, adding that the online to offline system that his company employs helps bring together used car buyer and sellers together with automobile manufacturers, dealerships, auto part suppliers, maintenance companies and other relevent bodies together in a tight and interconnected supply line.

Industry Analyst Zhang Zhiyong pointed out that the services pahaoche.com.cn supply are by no means unique, as many other enterprises are also looking to provide similar services. "The current trend [in the market] is towards utilizing online platforms in perfecting the used car market."