In recent years, the automotive industry has witnessed a remarkable transformation in the field of buying and selling of cars. At the forefront of this change stands Cars24, a company that has redefined the online car buying and selling experience. With its innovative business model, Cars24 has not only made the process more convenient but has also created a lucrative platform for itself.
Let’s delve into how Cars24 operates and the indigenous ways through which it generates revenue.
Let’s get started!
Cars24: Their Profile
As we go by the name, Cars24, cars that’ll be available 24X7. Cars24 was founded by Vikram Chopra, Mehul Agarwal, Ruchit Agarwal, and Gajendra Jangid. It’s an e-commerce platform that simplifies the buying and selling of used cars and makes the whole process much more efficient and reliable.
Cars24 is now being known as a unicorn used car company. The company entered into the unicorn club by having a $200 million in financing on November 24, 2020.
|Name of the Company||Cars24|
|Founders||Vikram Chopra, Mehul Agarwal, Gajendra Jangid, Ruchit Agarwal|
|Services||Buying and Selling of cars|
|Services provide in areas||India, Australia, Thailand and UAE|
|Revenue||$371 million (FY21)|
|Funding||$1.52 billion (Dec 2021)|
|Customer base in India||Over 6 Lakh since setup|
The tale of Cars24 begins when one of the founders of the company, Vikram Chopra, CEO, was looking to buy a car and had an appropriate budget to buy a used car. But eventually faced a lot of hurdles in finding how good the quality of used cars was, and couldn’t get enough financing and funding at that time and he ended up buying a new car instead.
We all might have faced the problem of high and low prices while selling and buying cars?
To make us all surpass this problem in the midst of the automotive turmoil, the founders of Cars24 came together with a revolutionary concept. In 2015, Cars24 officially hit the road. This marked the beginning of a new era in the automotive industry. The founders recognized that the traditional approach was due to modern makeover.
Armed with this realization, they set out to build a platform that would bridge the gap between car owners and buyers in an innovative and tech-savvy way.
How Cars24 works
It’s an e-commerce platform that enables buying and selling of automobiles that includes cars and bikes, with ease. This platform provides a great and wide range of good quality certified cars and also provides convenient delivery of vehicles to your doorstep only with some clicks.
The company looks after all of its buyers and sellers and with the help of advanced technology AI, shows exact and accurate market pricing of its vehicles.
With the help of this platform you can sell your car within 2 hours with good customer support at the company end and can get an accurate price of your car.
It is one of the fastest emerging companies in India, it addresses the problems and issues faced by the car owners related to buying and selling and quality of cars by providing them good user interface and hassle free experience.
Let’s get into deeper sights of the Cars24 business model!
Cars24 works on a CUSTOMER-TO-BUSINESS (C2B), which means it facilitates the direct sale of used cars from individual car owners to the company. This eliminates the need for middlemen and dealers, streamlining the process for both parties involved.
It enables end-to-end transactions and charges a commission for each transaction as its fees, which equals 4-6 % of the transactions.
A. the advantages of Cars24 model –
Convenience – the word that matters the most when selling or buying a car. Sellers can avoid the hassle of listing their cars, negotiating prices, and meeting multiple buyers. Cars24 offers a one-stop solution.
The inspection process ensures that buyers are aware of the car’s condition, fostering trust.
(A3) Quick transactions:
Cars24’s streamlined process allows for rapid transactions, which is especially appealing to both sellers and buyers who value efficiency.
The expert part here- Car24’s extensive experience in the used car market provides peace of mind to both sellers and buyers.
b. how Cars24 make money –
One of the most important parts of this topic!
(B1) Car buying at competitive prices –
Cars24 purchases used cars from individuals at competitive market prices. The company’s extensive network and data-driven pricing algorithms ensure that sellers receive a fair deal for their vehicles.
(B2) Inspection and certification services:
To guarantee transparency and build trust among buyers, Cars24 conducts rigorous inspections of each vehicle. This service comes with a fee, generating revenue for the company. The comprehensive inspection report also aids buyers in making informed decisions.
(b3) Value-Added Services
Cars24 offers additional services such as RC transfer assistance, loan closure support, and insurance renewal. These services come at a cost, contributing to the company’s revenue streams.
(B4) Online Auctions:
Some vehicles that meet specific criteria are listed on Cars24 online auction platform. Interested dealers can participate in these auctions by paying a fee, generating revenue for the company.
(B5) Data Monetization:
With a vast amount of data on the used car market, Cars24 can analyze trends and provide valuable insights to other stakeholders in the industry, such as dealers, manufacturers, and financial institutions. This data monetization strategy adds another dimension to the company’s revenue generation.
Cars24 Growth and Competition
Cars24 has experienced remarkable growth since its inception in 2015. The company’s innovative approach to the used car market, along with its commitment to transparency and convenience, has resonated well with the users.
Cars24 is currently termed as the leader in the online used car market as it acquires over 90% of the market share.
While Cars24 has seen considerable success, it operates in a competitive market where other players also offer similar services.
How is Cars24 is different from its Competitors
Cars24 stands out in the competitive landscape of online used car markets due to its unique business model and innovative approach.
Here are some of the key ways in which Cars24 is different from other online used car marketplaces:
- Instant payment: Cars24 offers sellers the advantage of instant payment. Once the inspection and valuation process is complete, the company provides immediate payment for the car.
- C2B Model: One of the most distinctive features of Cars24 is its c2b model. Unlike many other platforms that primarily connect individuals, buyers and sellers, Cars24 directly buys used cars from individual sellers.
- Quick transactions: The streamlined process offered by Cars24 leads to quick and hassle-free transactions. This is particularly appealing to both sellers and buyers who value efficiency and time savings.
- Online auctions: While Cars24’s core model involves direct buying from individuals, the platform also has an online auction system where certain vehicles meeting specific criteria are listed for dealers to participate in auctions. This caters to a broader spectrum of buyers.
Cars24’s business model is a testament to how technology can reshape traditional industries. As of now its valuation is $3.1 billion (Rs.26,322 crore). By leveraging its C2B model, comprehensive inspections, and value-added services, Cars24 has not only revolutionized the car buying and selling experience but has also created a sustainable and profitable model. As the company continues to innovate and expand, it will undoubtedly play a pivotal role in shaping the future of the automotive market.