INDONESIA USED CAR MARKET

Indonesia used car market is forecast to grow at a robust CAGR of 5.5% between 2025 and 2032 fueled by rising interest in secondhand vehicles along with rising disposable income and the emerging online sales channels.

Major Market Drivers and Emerging Trends

The Indonesia used car market size growth is supported by the increasing middle class population along with rapid urbanization and continuous infrastructure development throughout the country. Indonesian Statistics reported a 5.03% economic growth in 2024 with GDP per capita rising to USD 4,960.

With just 17.9 million registered passenger vehicles the automobile industry in Indonesia offers purchasers special advantages and suggests significant growth potential for car ownership. The used car market thrives owing to the affordability factor with many Indonesians unable to afford new cars because of their high vehicle prices and taxes. The primary issue is the widening disparity between escalating car prices and the slow increase in household income levels.

Car prices have jumped by 37% in the last ten years while household income levels have only risen by 28%. This disparity has placed additional pressure on consumer’s ability to make purchases. With new car prices surpassing the average household income annually many are left with no choice but to buy used cars or postpone the purchase entirely. Decisions to purchase new cars are also being influenced by the rising interest rates set by Bank Indonesia particularly for those who rely on financing options. Rising interest rates lead to larger monthly payments which makes new cars increasingly unaffordable for many potential buyers.

Online platforms have become the main source for comparing prices and choosing a vehicle as the digital transformation continues to change customer buying habits. The move to digital channels has been propelled by the growing internet penetration in the country with 79.5% of the population using mobile internet especially among Gen Z.

Significant investments in online platforms have been made in Indonesia used car market which indicates its potential for growth. In order to improve vehicle availability and price comparisons on single platform developers are updating mobile apps with advanced capabilities. Large used car listings with many alternatives including SUVs or electric vehicles are now available through Android apps like Moladin and OLX Autos.

With almost 80% of purchasers depending on financing alternatives to purchase their automobiles, the availability of finance options for used cars has further increased customer accessibility to purchasing a vehicle. More than 200 multifinance companies in the country compete to provide flexible financing plans and competitive lending rates which supports the financing ecosystem.

The Indonesia used car market is primarily dominated by West Java which is the most populous province in the country. As key cities in West Java, Bekasi and Bandung are the third and fourth most densely populated cities in the country respectively. SUVs are growing in popularity in used car sales in the province because they offer the versatility to be driven across the region including in more remote areas.

Despite the market’s strong performance it still encounters various challenges. The industry struggles with multiple challenges like complex regulations along with unpredictable demand trends and logistical difficulties. Ensuring that used cars meet high quality standards is also a significant concern for sellers and buyers. Tackling these obstacles is essential for sustaining the growth momentum and ensuring the ongoing market growth in Indonesia.

Based on vehicle type the SUV segment is anticipated to lead the market share. SUVs are becoming popular among used car buyers in recent years. As dealers work to provide fresh options for this growing industry consumers continue to show interest in the newest SUV models. The growing desire for SUVs among local purchasers may be fueled by the interest among younger generations.

Used SUVs are more popular owing to their ability to handle various road conditions. SUVs are a desirable option for off road or urban commuting owing to their outstanding performance which stems from improved road infrastructure and increasing urbanization.

Based on vendor type, there are organized and unorganized segments. The informal sector tends to offer much cheaper prices than traditional dealerships and online platforms when comparing costs. Consumers on a tight budget particularly those with lower incomes are attracted to this affordability as they may lack access to financing or want to avoid the additional costs associated with formal deals.

Based on fuel type the market is categorized into petrol and diesel segments. Generally petrol cars are much more affordable both when purchasing and maintaining them over time. This makes petrol cars more accessible for a larger segment.

Based on sales channel, the market can be segmented into offline and online platforms. The offline sector remains dominant because it gives opportunity for test drives and allows consumers to negotiate prices directly with vendors. This personal interaction can strengthen trust between vendors and consumers. However the online channel is expanding quickly fueled by rising internet access and smartphone usage with internet users making up almost 80% of the population. By integrating trusted vehicle inspections and collaborations with reputable dealerships, online platforms have addressed trust issues which contribute to segment growth.

Top Market Players

Leading companies in the market are OLX, Carro, Carsome, Toyota Trust among others. Strategic investments along with mergers and acquisitions among key players are transforming the competitive dynamics in the country. Combining their capabilities and offering clients comprehensive solutions are the main goals of these partnerships.

Key Developments

• • In 2022, Carsome completed its acquisition of iCar Asia which was formerly under the Catcha Group, by taking over the remaining 80.1% stake. The acquisition was valued at about USD 200 million in total investment.
  • In 2022, Carsome Indonesia partners with Bank Jago in a collaboration agreement aimed at providing financing to support its used car marketplace.

Segments covered in the Report:

The Indonesia Used Car Market has been segmented on the basis of Vehicle Type, Vendor Type, Fuel Type, and Sales Channel. Based on Vehicle Type, the market is segmented into Hatchbacks, Sedans, and Sports Utility Vehicles (SUV). Based on Vendor Type, the market is segmented into Organized and Unorganized. Based on Fuel Type, the market is segmented into Petrol and Diesel. Based on Sales Channel, the market is segmented into Offline and Online.

Market Segmentation

Indonesia Used Car Market by Vehicle Type

• • Hatchbacks
  • Sedans
  • Sports Utility Vehicles (SUV)

Indonesia Used Car Market by Vendor Type

• • Organized
  • Unorganized

Indonesia Used Car Market by Fuel Type

• • Petrol
  • Diesel

Indonesia Used Car Market by Sales Channel

• • Offline
  • Online

Indonesia Used Car Market Leading players (Option 1: Free 25% Customization – Profiles of 5 Additional Companies of your Choice)

• • OLX
  • Carro
  • Carsome
  • Toyota Trust