English English

Fast developing e-commerce has helped boost sales of used cars in China, as the online secondhand market gains in quality and variety.

The country's largest used car e-commerce platform, Uxin Ltd launched its initial public offering on the Nasdaq last month. Its market value closed at $2.97 billion on July 2 when it debuted.

Dai Kun, founder of Uxin, said the online market for used cars should focus on establishing a product standardization system to give customers confidence in purchasing used cars, like shopping for other products online.

He said the company provided a package of services from tests of secondhand vehicles and sales, to car loans and maintenance.

Xu Guoyun, former vice-president of Renrenche, another leading online vehicle transaction platform, said the Uxin IPO signaled that the capital market was optimistic about online sales of used cars.

"Compared with traditional brick-and-mortar stores, online stores have a higher trading efficiency," Xu said.

Uxin's first quarter sales hit 165,000 vehicles, up 61.6 percent year-on-year.

Compared with the boom in online business, China's largest secondhand car market, the Huaxiang market in southern Beijing, which has a cluster of more than 600 shops, is seeing fewer shoppers.

"It is obvious that the market is having a smaller flow of visitors, as more and more customers opt to shop online," said Qin Ce, who has been working in Huaxiang for five years as a salesman.

Vendors in the market are trying to catch up with digital sales by publishing their sales information on social media platforms such as WeChat, Weibo and Kuaishou to help strengthen offline business.

Sun Guodong, CEO of Jiabailie Zhonglianhang (Beijing) Secondhand Vehicle Trade, said online platforms would become the mainstream channel for secondhand vehicles in the future, as customers opt for convenience, but after-sales services would still mainly rely on brick-and-mortar stores.

He said the company sold 800 cars last year, with online sales accounting for half of the company's overall sales, and 70 percent of cars sold being middle and high-end models.

According to research done by Analysys, the total number of China's online sales of used cars reached 2.18 million units in 2017, up 51.2 percent year-on-year. It forecast the number would increase to 6 million cars by 2020.

Jia Xinguang, executive director of the China Automobile Dealers Association, said that as China lowered tariffs on imported vehicles and auto parts, and cut the first installment of car loans, the market would see greater growth.

Wang Meng, an online car dealer, said young people in China no longer use a car until it cannot be repaired, but rather change cars for the style and new technology.