T

he economic slump has been a blessing in disguise for second-hand car dealers as the slowdown has prompted customers to seek more affordable vehicles.

Handy, a used car dealer at Blok M Plaza in South Jakarta, is upbeat about business this year. The 33-year-old said sales were on a positive track.

He started his business in 2012 and has sold between 250 and 300 used cars every year, an average of 20 cars per month.

However, the prospects seem brighter this year. His monthly sales have increased to around 25 cars, resulting in hope that full-year sales will be higher than usual.

“More and more people are buying used cars. I think the slowing economy has caught up with those who initially preferred brand-new cars.”

As various figures suggest, the economy has yet to get back on its feet after weak growth over the past few years.

In the first quarter, for instance, the annual growth rate stood at 4.92 percent, lower than 5.04 percent posted in the last quarter of 2015.

Domestic consumption, which has always been the strongest driver of growth, rose by only 4.94 percent year-on-year in the first three months, a reflection of somber spending.

Ganindro Dananjoyo is among those now opting to purchase used cars, considering the vehicles’ relatively good quality and lower price tags.

In February, he bought a 2007 Nissan Latio for Rp 120 million (US$9,000). The same model was sold for Rp 200 million when it was launched nine years ago.

Other used car sellers are also hoping to cash in on the trend. Carmudi Indonesia and Mobil88 have introduced a financing facility to help generate more customers.

Carmudi offers its customers a 30-day or 90-day warranty for purchases of used cars, while Mobil88 recently introduced a “Mudik Asik” program to entice new clients.

Car dealers are not the only ones enjoying the rising popularity of used vehicles. Multifinance companies are reaping benefits as well.

Adira Dinamika Multi Finance finance director I Dewa Made Susila acknowledged the growing interest in used cars.

Publicly listed Adira — a major player in automotive financing — booked around Rp 5.49 trillion in used car financing last year, 18 percent of total new financing.

A year earlier, used cars made up only 14 percent of Adira’s new financing, at Rp 4.8 trillion. “Customers are scaling down their spending and are now turning their sights to used cars,” he said in a telephone interview.

Made said dealers would offer promotional programs ahead of the Idul Fitri holidays, when many people purchase cars to return home.

A similar situation was recorded by BFI Finance. Sudjono, the company’s finance director, said it hoped to attract more customers, especially for used cars, by offering a lottery program throughout the year. (adt)