Last year, sales of new cars decreased, according to various estimates, by 7–15%. At the same time, sales of used cars, on the contrary, showed growth of 14% and now account for almost a third of the total market. At the same time, the share of used cars purchased on credit is extremely small and does not exceed 2%. This indicates that a niche for car lending has emerged in the market, which is in demand among Ukrainians.
Issuing loans for the purchase of used cars has always been of interest to Ukrainian banks. However, the launch of such programs is constrained by the complexity of transaction processing and increased risks. In addition, the development of this direction is hampered by the fact that most transactions with such cars are concluded directly between private individuals, bypassing dealers.
Nevertheless, the introduction last year of special duties on the import of new cars and a recycling fee, which significantly increases the price of foreign cars, has made lending for used cars more relevant for both clients and financial organizations. This point of view was voiced by Ekaterina Melesh, CEO of the company "Center for Financial Solutions" (trademark "CreditMarket").
"According to the results of last year, the number of loans we issued for the purchase of used cars increased by about 11%. At the same time, sales of new cars in the market as a whole fell noticeably," noted Ekaterina Melesh.
Thus, the Association of Auto Importers and Dealers recently published data according to which 203 thousand new cars were sold in 2013, while a year earlier this figure was 237.6 thousand. At the same time, the used car market grew by 14% over the same period (according to the information of the association "Ukravtoprom"). The greatest increase in demand was recorded for used passenger foreign cars — here sales increased by 43%.
"Many buyers who previously planned to purchase a new foreign car now realize that due to duties restricting the import of such cars, they overpay tens of thousands of hryvnias. For example, the recycling fee increases the cost of a car by an amount from 4.73 thousand to 60.5 thousand hryvnias.
In addition, from January 1, 2014, Euro-4 environmental standards came into force, which prohibit the import and registration of cars that do not meet these requirements. All these factors shift the preferences of potential buyers towards the used car market.
In this regard, lending for used cars is becoming increasingly in demand and can give a significant impetus to the development of the car market.
