Economic Watch: China's used car market growing up with young consumers

TIANJIN, Jan. 13 (Xinhua) -- For Wang Xiaohan, a newly minted graduate entering the workforce, buying her first car came down to arithmetic rather than aspiration. Notably, a three-year-old sedan with fewer than 50,000 kilometers on the odometer costs roughly half as much as a comparable new compact.

"I just need something to get me to work," she said. "Cost efficiency matters most. A second-hand car fits my budget without putting me under pressure."

Such calculations are increasingly common among young Chinese consumers. A recent industry survey suggests that used cars are emerging as the preferred choice for a growing share of those born in or after 1990, signaling a quiet redefinition of what a car represents.

The nationwide study of young second-hand buyers, jointly released by China Auto Information Technology (Tianjin) Co., Ltd. and the automobile information, trading and services platform Dongchedi, also known as DCar, found that 94 percent of respondents were first-time car buyers. Nearly four in five said their purchase was driven primarily by everyday transportation needs.

Affordability sits at the heart of this shift. More than 60 percent cited price as the decisive factor, with most gravitating toward vehicles priced between 50,000 and 100,000 yuan (roughly 7,000 to 14,000 U.S. dollars), according to the report.

Rapid depreciation of new cars has reinforced this appeal. Almost half of the respondents said they opted for used vehicles to avoid steep value loss. Data from the China Automobile Dealers Association (CADA), which tracks resale value retention, show that many models lose about half their original value within three years.

"I worry that battery technology could move on soon after I buy a new car," Wang said. Describing herself as a "wait-and-see buyer," she regards a used car as a practical interim solution, allowing her to meet immediate mobility needs without locking herself into fast-depreciating technology.

Market data suggest that demand and supply are aligning in China. In November 2025, the average transaction price of second-hand vehicles stood at 64,100 yuan, according to the CADA. Cars aged three to six years accounted for the largest share of transactions, at 42.72 percent, while vehicles under three years old made up 26.89 percent, also registering modest growth.

As digital natives, young buyers increasingly navigate the second-hand car market online. The survey revealed that 72 percent obtained car information through automotive apps, while 64 percent relied on short videos or livestreams.

Online platforms have also overtaken traditional offline markets as transaction channels. Models combining online selection and ordering with offline test drives, and backed by seven-day free return policies, have helped ease long-standing trust concerns.

This approach appealed to a young man surnamed Qing, who in March last year bought a second-hand NIO ET5T electric vehicle through Dongchedi. Before placing the order, he watched a 40-minute video detailing the car's condition inside and out.

The vehicle was delivered to Chengdu, southwest China's Sichuan Province, with all registration and transfer procedures completed. After a test drive, Qing finalized the purchase. Six months later, he said the car had "totally exceeded expectations."

Some young buyers have pushed value-seeking even further, turning to vehicles produced by struggling or defunct automakers, drawn by sharply discounted prices.

Industry observers see this as part of a broader reassessment of value. Having grown up amid rapid technological change, younger consumers show less attachment to brand premiums and more interest in tangible components and functional reliability.

"I'm not betting on the automaker's revival, but on the reliability of the battery cells supplied by CATL," said a Gen-Zer programmer who bought a heavily discounted Jidu 07 model after the brand ran into serious operational difficulties.

Others echoed the sentiment. "I'm not buying a brand, but a set of usable hardware," said another buyer who purchased a WM Motor W6 for around 60,000 yuan, down from an original price of about 280,000 yuan. For such buyers, affordability, combined with a relatively young vehicle age, outweighs brand pedigree.

This cost-conscious approach reflects a broader shift in consumption psychology.

"Young consumers are paying closer attention to core attributes such as safety and cost efficiency, rather than branding or flashy but non-essential features," said Bo Wenguang, an associate professor at the School of Economics of Nankai University in north China's Tianjin Municipality.

The trend has unfolded alongside steady market expansion. From January to November 2025, second-hand vehicle transactions reached 18.24 million units nationwide, up 2.95 percent year on year, with total transaction value hitting 1.17 trillion yuan, according to the CADA.

Despite the headline growth, the sector still faces challenges.

Industry associations noted that intensified competition in the new-car market, characterized by frequent price adjustments, has narrowed the price gap between new and used vehicles, placing sustained pressure on used-car dealers.

Meanwhile, information asymmetry, such as incomplete disclosure of vehicle condition and usage history, and uneven third-party oversight, among others, present uncertainty to used-car buyers, observers noted.

Zhao Zhifeng, head of Dongchedi's second-hand car business, said platforms must build competitiveness supported by three pillars, namely trust, cost and convenience.

"Raising the bar for vehicle-condition transparency is essential," he noted, calling for fully disclosed, visualized electronic reports covering key component diagnostics and traceable maintenance histories.

Similar views have been voiced by other platforms. Wang Xiaoyu, co-founder of used-car marketplace Guazi, has called for unified inspection and evaluation standards, and stronger service guarantees to attract more consumers. ■