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OLX Study Finds 71% Consumers Upgraded To Less Carbon Intensive Cars Through Secondhand Trade

The report highlights the significant contribution of secondhand car trade to decarbonize India's vehicle fleet and build a more sustainable economy

OLX Study Finds 71% Consumers Upgraded To Less Carbon Intensive Cars Through Secondhand Trade

Outlook Start-Up Desk

POSTED ON April 07, 2023 7:49 PM

A research report by online marketplace OLX showcased the potential of secondhand car trade in reducing carbon emissions from India’s transportation sector. Based on a Life Cycle Analysis (LCA) and primary consumer research, it highlights the significant contribution of secondhand car trade to decarbonize India's vehicle fleet and build a more sustainable economy.

According to the LCA research, on average, 86 per cent of emissions over the lifetime of an average Indian car are emitted during the use of the car and production of the fuel, in contrast to just 14 per cent during the manufacturing and disposal of the car. Additionally, within the transport sector, 45 per cent of emissions stem from passenger transport. 

Specifically in India, transport ranks third on emissions. But it is growing fast, given the country’s relatively small fleet size per capita in a country with strong population growth.

The primary consumer research undertaken by OLX showed that 71 per cent of interviewed people that bought a secondhand car switched to a vehicle with lower emissions per driven kilometre, resulting in a 14 per cent reduction of combustion emissions per kilometre, on average. 

The study surveyed consumers in four metro areas of India, and the majority of users traded in vehicles with improved fuel efficiency, with 68 per cent of respondents switching their car to one with enhanced fuel efficiency.

Based on these insights, the second-hand car trade holds the potential for reducing emissions through technical improvements in fuel economy. Car buyers in India are switching to more fuel-efficient vehicles through secondhand trade. The more secondhand cars circulate, the faster the carbon intensity of the fleet drops.

"This research offers a starting point that shows the potential of secondhand car trade for building a sustainable economy. We believe that secondhand car trade can help improve a car fleet's average fuel efficiency through the faster adoption of newer cars with high fuel economy," said Amit Kumar, CEO of OLX.

The report demonstrates the significant potential for the secondhand car trade to contribute towards a more sustainable economy in India and highlights the importance of encouraging the adoption of more fuel-efficient vehicles to reduce carbon emissions. 

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