Before starting an auto classifieds site, many webmasters are asking themselves a number of questions, and since we have helped hundreds of people launch their auto desks, we know their questions and concerns.
The biggest question is “Can I beat off competition from hundreds of similar sites?”
The second biggest question “Is the demand for cars rising or falling?”
Since many of the webmasters deal in second-hand cars, the third question is “Do people buy used cars more often than new ones or vice versa and what is the ratio between new and used car sales?”
Because we develop and support car classifieds software, we believe it is imperative that we answer the above questions so that you could see for yourself whether it is the right time to start a car classifieds site. At that, we want to be as unbiased as possible; therefore, all the information in this post will be supported by facts and current vehicle market reports and statistics.
Are people buying more cars nowadays?
The answer is Yes. People are buying more cars today and the sales will rise in the future irrespective of the economy. The explanation is simple – the world population is rising steadily and there are more people who are in need of cars. According to WardAuto, automobile trade magazine active since 1924, U.S. population grows by 2.2 million people each year! The population of the European Union is also rising by 1.5 million people yearly. It doesn’t take a rocket scientist to figure out that more people buy more cars and the sales increase by millions.
New vs used car sales figures
WardAuto reports that more and more Americans prefer to buy used cars. There are a number of reasons for that. To start with, middle-class incomes have not changed for over a decade. Secondly, prices for new cars are often unaffordable for middle class citizens. It does not mean however that Americans are choosing old cars in poor condition. Instead, Americans prefer used premium and luxury cars, which are a lot cheaper than brand new ones from the salon. The price for an average new car in the U.S. is $33,500 whereas the 3-year-old second hand car costs $19.000 on average, according to 2016 used vehicles report by Edmunds, an online resource for automotive information. If we look at statistics for used cars sold in U.S. since 2011, we will notice a steady 3% increase in sales numbers year after a year.
Statistics by Edmunds
It is also worth noting that the price for second-hand cars is rising steadily in the U.S. While the average price for a used car was $14.k in 2005, it was 19.2k in 2016 and, given the statistics, we believe it will be over 20k in 2017.
Another 2016 used car market report released by Manheim, the world’s largest auto action, indicates that the sales of used cars in the United States have been rising for the past 6 years and the growth is predicted for the future.
People who buy new cars are still a target audience for a used car market place WardsAuto reports that over 17 million vehicles were sold in the United States in 2015, the numbers for 2016 and 2017 are likely to increase. The number of used cars sold yearly is close to 10 million vehicles and we still see that twice as many people prefer to buy new cars. However, you should also take into account that an average American owns around 10 cars in a lifetime and changes a car every four years, according to WardsAuto. That means that people who buy new cars still need to sell them later and the best place to do that is on a used car site.
Auto Industry in Europe and the rest of the World
If you’re a webmaster from Europe or any other country other than the U.S., you’re probably thinking how is these stats relevant to me? I’m not in the U.S. and my site is going to target a country, which is an ocean apart from America. If we look at the European Union, we will see that more people are buying and selling cars than before. This has to do with the population growth and high quality of life. According to European vehicle market statistics 2015/2016, the number of passenger cars on European roads in 2015 equaled to 251 million and the number is expected to increase by 7 million cars by 2030.
How and where do people prefer to buy cars?
Buyers nowadays increasingly rely on the Internet in the search for a car. According to a survey conducted in eight major countries 80% of buyers use the Internet to initiate a search for a car. 75% of the respondents said they preferred to make the entire buying process online. Currently, 69% of people who own a car today had found and bought it through an online Autodesk or a used car site. 63% of the respondents said they would like to buy a car through an online auction. With the survey results in mind, you absolutely need a used car site preferably with an online auction Plugin allowing sellers to put their cars up for an auction and potential buyers to place bids. Nowadays, the Internet is changing the game and if you don’t have a website to showcase your listings, you are bound to lose at least half of the market.
Since we develop a car classifieds script, we are obviously interested in selling it and convincing you that you do need to start a car classifieds site. At the same time, we wanted to make this post as unbiased as possible and free from loud and unsupported statements. The key idea is to put all of the facts and statistical findings before your eyes so that you could see the potential for auto business. Ending this post, we would like to give a helpful recap of the key findings in it:
- Car sales are increasing all over the world;
- An average American changes a car every four years;
- More people opt to buy used cars;
- Up to 80% of buyers start a car search process online;
- The number of cars on the roads is increasing;
- There is considerable commercial potential for starting an online marketplace.
Although even a good business idea requires time and effort on your part in order to be successful, it’s always good to know that the idea of starting an online market place is economically feasible. We have helped hundreds of webmasters tap into the booming car market and we hope that we will help you as well, and your car classifieds site will soon find its first buyers.