What is your earliest memory around luxury cars? How did the idea of entering the used luxury car industry materialize?
Since I can remember, I have always been passionate about cars. During my college days, I used to buy multiple automotive magazines every month to learn about cars – their specifications, variants, features, etc. This helped me a lot in understanding the industry.
Whenever I used to see a car on the road, I would instantly know its specifications, features and even the ex-showroom price of that particular model. So, after finishing college, when I decided to start my own business, it was a no-brainer that it had to be related to cars. That was when I decided to launch a portal called KoiBhiCar.com, which dealt with buying and selling of cars.
After starting KoiBhiCar.com in 2012, what necessitated the shift to the offline model?
During the KoiBhiCar.com period, I realised my inclination for luxury cars and pre-owned luxury cars. Even our portal featured only pre-owned luxury cars. But eventually, I realised that people were not very comfortable buying pre-owned luxury cars online at that time. Since purchasing a luxury car has always been a matter of big investment, people wanted to inspect the cars offline, and that is when I decided to open our first showroom in Delhi in 2014 and named it Luxury Ride.
Give us an idea about the size and scale of operations at Luxury Ride at present. What is your USP? What is the quantum of franchise operations?
Right now, Luxury Ride has its presence in seven cities across North India, namely, Delhi, Gurugram, Karnal, Chandigarh, Jaipur, Dehradun and Ludhiana. The showrooms are a mix of company-owned and franchise operations. Talking about the USP, we are a one-stop solution for our customers. We offer all the facilities or solutions a customer might need in the form of 15 days money back guarantee, easy finance and insurance, warranty, service centre, etc.
Take us through your offerings – the range of cars that you sell and the customer profile. Which are the most popular used luxury cars?
Luxury Ride focuses on premium brands like Audi, BMW, Mercedes-Benz, Porsche, Volvo, Jaguar, Lexus, Mini Cooper, Volkswagen, Land Rover, Bentley and other exotic cars in the price range of Rs 12 lakh to Rs 2 crore. Our sweet spot is around Rs 40 lakh.
Our maximum customer traction comes from metro cities, which see large transactions in terms of selling and buying pre-owned luxury cars. Over time, the market is also making inroads into Tier II and Tier III cities like Jaipur, Chandigarh and Dehradun, to name a few. The masses in these cities are showing a preference for high-end premium cars with unmatched performance that comes within their budget.
Talking about the most popular pre-owned cars, Mercedes Benz CLA and C Class, the Jaguar XE and the BMW X1 have been quite popular and we get a lot of queries for these from our existing and aspiring customers.
Overall, what are the challenges before you at Luxury Ride and the used luxury car industry as a whole? How organised is the sector?
The biggest challenge that the industry faces today is the trust issue amongst first-time buyers. As a lot of people have had bad experiences while buying pre-owned cars from the unorganized sector; they feel it will be the same case in the organized industry as well.
However, things are changing slowly due to the transparency that organized players are offering with regard to condition of the cars, transactions and after-sale service. Lack of a substantial number of organized players in the market is hampering growth of the pre-owned luxury car segment, as people usually find it uncomfortable buying pre-owned luxury cars from unorganized players. This is due to several reasons, such as lack of trust or vehicle-servicing hassles they fear facing in the future.
What has been the fallout of the pandemic on the business?
Pandemic time has been challenging for us in terms of business. However, post the pandemic, things turned slightly in our favour. We witnessed a huge surge in demand for pre-owned luxury cars as OEMs were unable to manufacture enough cars and companies’ plants were shut during the pandemic.
Compounding the already existing problem, the semi-conductor shortage gave way to new obstacles in the form of long waiting periods that forced customers to look for alternatives. Therefore, people started shifting their focus towards buying pre-owned luxury cars which led to growth in our business.
How have you seen the used luxury car segment evolve as an industry over the last few years? What are the trends that you see today?
The pre-owned car market has been growing over the years. For instance, during pre-COVID times, the ratio of the sale of new and pre-owned cars was 1:1.2, but after the pandemic, it currently stands at 1:1.72. The same trend has been observed in the pre-owned luxury car segment – more and more people are switching to pre-owned luxury cars.
The future looks very promising for the pre-owned luxury car segment where the market is expected to grow. If we look at the current trend, owners of premium sedans like Toyota Corolla or the Honda Civic are upgrading to pre-owned luxury cars. Even people owning SUVs within the price range of Rs 15-20 lakh are joining this trend of shifting to a more premium pre-owned luxury car.
What next for Luxury Ride? How do you plan to grow and expand the business, considering that your operations are centered around North India only right now?
We want to open several new showrooms in southern and central parts of India. We are working on a few things; as soon as they are finalized, we will come up with our showrooms in more cities. We aspire to add 50 more showrooms in the next 4-5 years. Our aim is to make Luxury Ride the biggest share-holder in the pre-owned luxury car market.
‘RISKS ARE INEVITABLE’
“From my experience over the years, I have learnt that risks are inevitable in life. If you want to be successful, you cannot avoid risks. But by facing them, you can come back stronger, which will change your life in a positive way. As Swami Vivekananda said, ‘Take risks: if you win, you will be happy; if you lose, you will be wise.’ This is the mantra for excelling in life,” says Sumit Garg.