Multi-brand certified used car company, Mahindra First Choice Wheels, today inaugurated its 700th outlet in the country at Mumbai.
The franchise based enterprise opened its latest outlet, 25th in Mumbai and 85th in the state, in partnership with Prosperous Wheels. Spread across 1000 sq. ft the dealership is located at Andheri. It was inaugurated by Rajeev Dubey, president (Group HR Corporate services and After Market) member of group executive board, Mahindra & Mahindra.
“We are creating a transformational change in the way we provide value to our stakeholders. To create a vibrant used car ecosystem, we are enhancing and leveraging our physical and online presence and are best positioned in the pre-owned car industry to deliver a “Brick and Click” synergy interface for a unique customer experience,” Dubey told Autocar Professional, adding that the company is on track to grow its presence and would end the financial year 2015-16, with 750 outlets in the country.
“Our emphasis is on the tier II and tier III cities, with almost 400 outlets in these places. The Indian used car market has tremendous potential and we have close to 60 products and services to cater to this growing market” Dubey added.
The pre-owned car market is flooded with players running various online portals. Carnation, Cardekho, CarTrade, ZigWheels and Droom are some of the major platforms in the segment. Despite OLX and Quikr being multi-category classifieds, they can also be considered competition.
These portals have raised huge amounts of funding in the past few years. In January this year, Cardekho raised $50 million in a round of funding led by Chinese funds Hillhouse Capital and Tybourne Capital. In October 2014, Cartrade raised $30 million from Warburg Pincus, Tiger Global and Canaan Partners. In July 2015, automobile-focussed marketplace Droom raised $16 million funding in Series A led by Lightbox.
The market is still hugely fragmented and Mahindra First Choice hopes to solve the real pain points of the vehicle transaction process like transparency and reliability.
“The classifieds and online portals are our biggest competition. Used car business is like a contact sport, one cannot be successful in this business without physical presence. We are confident that we will maintain and grow our share in the market as we have online presence to provide information to the customers and the complimentary brick and mortar set up to deliver,” explained Dubey.
Mahindra First Choice ventured into the commercial vehicle space one and a half years ago and has grown by leaps and bounds since then. With 230 CV outlets in the country now, the company aims to complete 14,000 transactions by the end of FY 2016.
The company primarily deals in light commercial vehicles of up to 3.5 tonnes through franchisee outlets.
“Right now we are focusing only on LCVs and mainly pick-ups. There aren’t many organised players in the CV business and it is a great opportunity for us. We are not looking to venture into M&HCVs at this point,” said Dubey.
With a strong emphasis on increasing its reach in the country through the franchisee model, growth in the CV business and an improved online presence, Mahindra First Choice Wheels looks to emerge as one of the largest players in the India used car market in the near future.