As far as expressing interest to buy new cars is concerned, Asia emerged as the strongest market, according to Carmudi’s white paper The Booming Automotive Industry in Emerging Markets.
“When it comes to new cars, purchase intent is strongest in Asia, where 65 percent of respondents say they will buy new in the next two years compared with 7 percent who plan to buy used cars,” said the report.
The report’s findings are the result of quantitative surveys conducted online with both car buyers and car dealers across Asia, Africa, Middle East and Latin America, and in-depth interviews with industry influencers across the world.
“The immense growth of global e-commerce has led to the boom of automobile purchase. Developing economies in Latin America, Middle East, Africa and Asia emerged as the most solid market base and fastest regional growth since 2011surpassing the more mature markets such as the US, UK, Japan, and Western Europe,” said Subir Lohani, managing director of Carmudi Philippines.
“The potential is enormous as e-commerce sales are expected to grow by 20.1-percent in 2015, reaching up to $1.5 trillion,” he added.
According to the Berlin-based online car portal, the growth of e-commerce can be attributed to the rapid expansion of online and mobile user bases in emerging markets, new shipping and payments options, and major brands expanding to more new international markets.
Moreover, Carmudi said the latest e-commerce statistics indicated 40 percent of worldwide Internet users, which amounts to more than 1 billion online buyers, have purchased products and goods online via desktop, mobile, tablet and other devices, and is projected to continuously grow.
In 2014, consumers in Asia made e-commerce purchases totaling $525.2 billion that was significantly higher than e-commerce purchases in North America that reached $482.6 billion.
Meanwhile, e-commerce sales in Latin America reached $799.2 billion and in the Middle East sales are expected to rise from $9 billion to $15 billion by the end of this year. Recent signs of developments in the African region have raised projections of business-to-consumer e-commerce sales reaching double-digit numbers in billions by 2018.
In more developed markets, Carmudi said online auto e-commerce has shown explosive growth that now as many as 80 percent of new car and almost 100 percent of used car customers begin their car shopping experience online.
“There is no reason to doubt that emerging markets will rapidly catch up to these figures. Evidence of this phenomenon can be seen when looking at automotive Google Search Queries [provided by Google]. The year-over-year search growth is astonishing, particularly in Africa,” said Lohani.
Citing a 2013 McKinsey report on Automotive Retail Innovation, Carmudi pointed out auto dealers are no longer the primary source of information, especially for millennial consumers between 18 and 34.
“Up to 90 percent of consumers in this group use a mix of OEM and dealer sites, forums, blogs and social media to gather information and compare prices and offers before making their final decision. Taking to the Internet to research and purchase cars shows no signs of slowing down,” Lohani said.