Taiwan's Automakers and Dealers Eye Used-car Market

Taipei, Nov. 19, 2012 (CENS)--The sluggish market is driving automakers and dealers to more aggressively develop used-car sales.

China Motor Corp. (CMC), the local assembler of Mitsubishis, is further expanding its dealership of certified used cars; while Hozhi Motor Co., a subsidiary of Hotai Motor Co. Ltd. (local agent of Toyota and Lexus) announced to provide more preferential terms for used-car loans.

Some automakers pointed out that used-car sales is growing in contrast to the new-car market, which has been declining due to economic downturn, because used-cars are more affordable to consumers with limited budgets.

Stronger demand, industry insiders said, drives price appreciation of used-cars more than before, giving higher profitability to dealers.

CMC began setting up dealers in major cities in Taiwan in 2007 to sell certified used cars. After setting up a used-car dealer in Kaohsiung, southern Taiwan in 2011, CMC moved it to a better location downtown recently, and plans to add five used-car dealers over the next three years.

Hotai tapped into the used-car market in southern Taiwan early this year, by setting up a joint venture with its major distributors to sell certified used Toyotas.

Hotai pointed out that Hozhi sold more than 3,000 used Lexus in the past eight years, and will offer more preferential loans soon to further boost used Lexus sales.

In 2011, some 378,000 new cars were sold in Taiwan, compared to about 700,000 used-cars transactions (or about 500,000 used-car sales), with the volume of the latter expected to be higher this year.