Premium Cars, SUVs Lead Growth In India’s Pre-Owned Market: IBB Report FY25

India’s pre-owned car market continues to grow at a pace, reaching 5.9 million units in FY24-25, according to the 7th edition of the Indian Blue Book (IBB). The annual report, developed by car&bike (Mahindra First Choice) in association with Volkswagen Pre-owned Certified, projects the market to expand at a 10 per cent CAGR (Compound Annual Growth Rate), touching 9.5 million units by 2030.

Mohammed Turra, MD & CEO, Mahindra First Choice, comments on this shift: “The Indian used car market has come of age, fuelled by rising demand, structural mobility needs, and growing acceptance of used cars as a smart, aspirational choice. Organised players are driving trust and transparency through certified vehicles, structured warranties, accessible financing, and AI-enabled journeys, creating unprecedented opportunities for buyers and sellers alike.”

The report highlights a shift in consumer preferences toward premium and feature-packed vehicles, with SUVs – especially compact SUVs – emerging as the dominant choice. Moreover, consumers are becoming more discerning, balancing price sensitivity with expectations of safety, features, and long-term value. Many buyers now see pre-owned vehicles as a way to access higher segments, moving from hatchbacks to compact SUVs or sedans, and from sedans to SUVs.

The IBB FY25 report underlines the growing role of organised players in the used car ecosystem. Over 70 per cent of surveyed customers believe organised dealerships provide better service quality, superior vehicles, and fair value for money, even with a slight price premium.

This transition is being driven by AI-enabled platforms and technology-based inspection systems, which are making transactions more transparent. The report notes that while only 6 per cent of used car purchases currently involve AI tools, adoption is expected to increase rapidly as digital confidence grows among consumers.

The Indian Blue Book FY25 also identifies the most sought-after models in the country’s pre-owned car market across key categories. In the SUV segment, the Mahindra XUV700 and Toyota Fortuner top the charts, followed by the Scorpio and Grand Vitara as strong contenders, while the Mahindra Thar is on the list as well

In the sedan category, the Maruti Dzire and Hyundai Verna lead demand, with the Virtus, City, and Slavia emerging as better-value options. The Volkswagen Polo and Maruti Baleno continue to dominate the hatchback space, followed by the Swift, i20, and Grand i10.

Among compact SUVs, models like the Volkswagen Taigun and Hyundai Creta take the top spots, followed by the Nexon, Sonet, and Brezza. In the MUV category, the Toyota Innova continues to hold its leadership position, ahead of the Ertiga and Kia Carens.

The report also highlights that vehicles aged between four and seven years now account for nearly 30 per cent of all organised used car transactions, reflecting consumer comfort with slightly older yet well-maintained vehicles.

Among the surveyed buyers, 66 per cent identified warranty coverage as the most important add-on when buying a used vehicle, citing peace of mind and aftersales support as key considerations. Cars with higher residual value and stronger build quality continue to enjoy longer ownership periods and stronger resale demand in the aftermarket. Additionally, 42 per cent of buyers choose to stay with the same brand for their next purchase.