From next year, large companies such as Hyundai Motor Company and Kia Motors will be allowed to sell used cars, which is expected to lead to a tectonic change in the used car market. Accordingly, expectations are rising among platform startups that broker used car sales. They emphasize the high preference of the MZ generation and convenience that compensates for the shortcomings of existing services as strengths.
According to related industries on the 1st, consumers are expected to be able to purchase used cars sold by large companies such as Hyundai Motor and Kia from January next year.
The Ministry of SMEs and Startups (Ministry of SMEs and Startups) held the ‘Small and Medium Business Adjustment Council’ on the 28th of last month and postponed the start of Hyundai Motor and Kia’s used car sales business by one year (May 1, 2022 – April 30, 2023) said to do However, it allowed trial sales of certified used cars within 5,000 units from January to April next year.
Used car platform startups are determined to gain an edge with services that meet the expectations of the market, as the focus is on ‘consumer welfare’ to allow large companies to enter the used car market.
‘Hey Dealer’, the No. 1 platform for ‘selling my car’ service in Korea, is gaining the trust of customers by providing 100% compensation for the depreciation that dealers have set unfairly on consumers. Last year, the accumulated compensation that Hey Dealer refunded to consumers through the ‘Unfair Depreciation Compensation System’ exceeded 1.2 billion won. Hey Dealer also introduced ‘Hey Dealer Zero’, which relieves the burden of meeting with dealers. The entire process from the visit of the evaluator to diagnosis and consignment is conducted non-face-to-face.
Another representative used car platform ‘First Car’ has a strong point of ‘traffic light search’, a service for inquiry of actual items. The service utilizes big data technology to check whether or not there is a false sale in just 3 seconds by entering the vehicle number. The traffic light search provides not only the search for false items, but also the time of completion of the sale of the vehicle, its existence, and the appropriate price range of the actual item. The traffic light search function exceeded 1 million cumulative searches last year.
The non-face-to-face used car trading service ‘Carmon’, launched in February, is also attracting attention. Kamon compensated for the shortcomings of the existing used car trading service, which lacked objectivity due to the direct judgment of dealers and consumers. When a customer simply leaves the car at an affiliated repair shop, the repair shop writes a report and handles the detailed procedures for the car auction. Kamon has completed alliances with over 900 repair shops nationwide, and plans to secure more than 2,000 affiliate repair centers within this year through additional alliances with franchise repair centers of large corporations.
Meanwhile, used car platform companies also expected synergies from large companies to enter the used car market. This is because the used car platform serves as a link between large companies and consumers, and can also create a new collaborative business model.
Kim Hyung-geun, director of Carmonster, said, “The more large corporations advance and transparently improve the market, the greater the opportunity can be seen. A form of collaboration model was also proposed to each company, and we received responses saying that it was being considered positively.”