Mexico has a new player in the used car sales market online. In a booming industry thanks to a shortage of chips for making new cars, Caranty wants to compete against other companies like Kavak, the first Mexican unicorn, or like OLX. But the company’s main target is transactions between individuals, which represent 80% of a market with a total value of 60,000 million dollars.
Caranty It started operations just three months ago as an intermediary for the sale of second-hand cars between individuals. Unlike Poplar, which buys cars and then sells them, Caranty offers a transparent channel between buyers and sellers so that they can carry out their transactions safely, which also differentiates it from second-hand ads, as it carries out legal and technical verifications before advertising any vehicle and responsible for delivering the money to the seller when the car has been delivered.
Both Caranty and its investors and managers are taking advantage of the boom in the used vehicle sector, which reached a growth of 19% in 2021. A boom that has been caused by the shortage of semiconductors that affects the manufacture of new cars and by the high demand for this type of goods. In the United States, the prices of used cars and trucks increased by up to 37.3% annually in 2021.
For Miguel Bulnes, executive director and founder of Caranty, the company is also taking advantage of the fact of entering a market in which, in Mexico, 40% of transactions involve some type of fraud. “Either they offer you immediate purchase with up to 45% loss in value of your car or you keep all the risk of selling it on your own,” he said.
Caranty charges 4% of the sale price of the vehicle, that is, if a person wants to sell a car for 100,000 pesos, the price that will appear in the marketplace will be 104,000 pesos. Afterwards, the buyer will have the possibility to negotiate with the seller through the platform itself and if they reach an agreement, the delivery of the vehicle can be made in one of the five exhibition centers (showroom) that the company has in Mexico City. .
Caranty plans to use the 1.9 million dollars from its seed financing round to increase the number of cars in its inventory, which currently reaches 300 vehicles, as well as start its expansion process to other cities in the country, such as Querétaro, Puebla, Guadalajara. and Aguascalientes. And although Bulnes affirms that the sector is oriented towards a complete digitization of transactions, the company maintains an operation that allows buyers to inspect the vehicle and thus not have customer service problems, as has happened in the case of Kavak .
Reference-www.eleconomista.com.mx