Published on Dec 13, 2021 11:06:00 AM
The interstate transfer of vehicle registration is currently a cumbersome process. Industry experts believe that digitization can help.
The demand for used cars has increased lately, and more and more people are preferring personal mobility amid the Semiconductor crisis crippling new car supply. Today, used car sales are expected to be 1.4 times the number of new car purchases, and the ratio is expected to rise to 1.8 by fiscal 2026.
However, when selling a used car, there are a number of weaknesses that need to be resolved first. “RC [registration certificate] Transfer is a complex process, ”said Amit Kumar, CEO, OLX Autos India, on the sale of used cars between states. “Clearing the market from bottlenecks and turning the whole country into a single market will remove many inefficiencies.”
- Registering a used car in another federal state is currently cumbersome
- OLX Autos has teams in major states that handle the process
- Few people could benefit from bra registration
Simplification of the procedure for the interstate transfer of registration
Amit Kumar, CEO, OLX Autos India: The RC transfer is complex so we have deployed field service teams across the states to handle it. But we have to eliminate the process for faster industry growth.
Kumar spoke to OLX Cars at an Autocar India panel discussion. Explaining the process of selling vehicles in different states, he said, “For example, if a person in Kerala wants to sell a car to someone in Guwahati, it is a painful process that requires you to obtain an NOC [no objection certificate] from the local Kerala RTO [regional transport office], and then register the vehicle in Guwahati. There are multiple RTOs that may not be communicating with each other. “
To avoid such problems, Kumar mentioned that traditional used car dealers often only buy and sell cars within a 200 km radius. “If we remove the bottleneck, we could do our stores faster and our dealerships grow,” he added. And here the online submission of the registration could be very helpful.
Vinkesh Gulati, President of FADA (Federation of Automobile Dealers Associations), took up the point. “FADA is pushing MoRTH [Ministry of Road Transport and Highways] to move to online remittance and if we can do that it will be a catalyst for the growth of this industry, ”he said.
This will also help remove old cars from polluted and congested cities. For example, 15 year old gasoline vehicles and 10 year old diesel vehicles are not allowed to drive on Delhi’s streets. After this period, Delhiites must either scrap their vehicles or sell them in other states. The latter could be facilitated by submitting the registration online.
How OLX manages interstate transfers
“We are responsible to our customers for their RC transfers and we take it very seriously,” said Kumar. He went on to explain the OLX process and continued, “We have field service teams in almost every country where we have high throughputs. These teams interact with the RTOs and get things done as the process of broadcasting an RC is a physical process on the very last leg or mile. “
A seller must physically complete Forms 29 and 30 for the transportation department to transfer ownership to the buyer. “So we do it physically. Otherwise our entire process is digitized. That’s how we do it, ”explains the head of OLX.
Bra registration is a hit and miss for now
At the beginning of the year the Ministry of Transport got a new one Bharat series (BH series) approval mark for vehicles This is valid across India, essentially eliminating the need to move to another state while moving or selling your vehicle. Not many benefited from it, however.
“It won’t do much good on used car sales as BH registration is only allowed for customers who have one [private] Offices in four or five states [or are defence personnel, central/state government employees]“, Commented Vinkesh Gulati from FADA.
In contrast to any other government registration, which is valid for 15 years, a BH registration has to be renewed every two years, which Gulati brings in for a lower price for the respective vehicle on the used car market.
He continued, “There are only five states that have started [issuing] BH and it didn’t happen in large numbers. Some military and employees of large corporations present all over India have done this registration. When you think of regular customers or companies, BH is of no use to them. “
“So let’s hope that MoRTH approves the online transfer of used cars. That would be a better boost for the used car market. ”
Rise of online marketplaces
How has the used car market developed? Who are the main actors? Hemal N Thakkar, director of the research company CRISIL, who also took part in the panel discussion, shed light on the darkness. “In the 1990s, the used car market was largely disorganized, with trade being largely carried out by auto repair shops and roadside workshops. Then in the 2000s [Maruti Suzuki] True Value was set up and you had an OEM supported organized setup. Then everyone came into this space, right from Hyundai H Promise to Toyota U Trust, Honda Pre-Owned and many others. Today there are around 14-15 players who are already in this field, ”he said.
The landscape has continued to change in recent years, with internet-based platforms like OLX Cars offering opportunities to build on. They have started giving used car buyers a six month to one year warranty, they run a certain number of tests on each vehicle, and all of this builds customer confidence, ”he said.
On the role of online marketplaces, he added: “The pace at which the used car market is growing is enormous and yes, online players will be an important parameter to definitely drive this forward.”
See also:
Skoda Certified Pre-owned program started
The used car market will be twice as large as the new car segment by FY2025
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