As delays in the delivery of the new Benz E-Class due to logistics issues continue, the nearly-new BMW 5 Series is gaining attention as a substitute, leading to expected price hikes.
K Car has analyzed the average prices of nearly-new cars in the domestic used car market, focusing on popular models released in 2023 with less than 10,000 km of mileage, announcing on the 11th that the price of the BMW 5 Series has risen by 5.7% compared to the previous month.
The logistics crisis has affected the prices of nearly-new cars from the two giants of the domestic import car market, BMW and Benz. A smooth supply of new cars is essential to maintain an adequate inventory in the used car market, stabilizing prices; however, as the supply of the new Benz E-Class is delayed, demand has surged for its competitor, the BMW 5 Series, driving up prices.
After surpassing Benz in new car sales to become the top-selling imported car brand in Korea for the first time in 8 years last year, BMW has shown strong popularity in both the new and used car markets, outpacing Benz again in the first quarter of this year.
In addition, the prices of imported used cars are generally expected to be stable or decline slightly. The prices of the Benz E-Class and S-Class are expected to fall by 0.9% and 0.2%, respectively, while the GLC Class and GLE Class may also see slight decreases of 2.1% and 1.4%.
Domestic cars are likely to remain stable as well. The Hyundai Grandeur (GN7), Kia The New Sorento 4th Generation, Kia The All-New Sportage, and Hyundai The New Avante (CN7) are expected to show no price changes, maintaining a slight increase of 0%. Genesis GV70 and Hyundai The All-New Santa Fe Hybrid are expected to see a decline in prices of around 0.5% to 1%, which is typical for used cars.
According to Lee Min-koo, chief analyst of the K Car PM team and adjunct professor at the University of Science and Technology’s Future Mobility Design Department, “The delay in the domestic release of the new Benz E-Class appears to be driving consumer demand toward the competitive BMW 5 Series. While BMW is relatively less affected by the logistics crisis, new car dealers are bringing in vehicles at high prices due to increased freight costs, and the inventory of nearly-new vehicles in the used car market is also decreasing, leading to a strong price trend.”
K Car, which was listed on the KOSPI market in October 2021, is the largest direct-operated used car platform company in Korea, operating under a direct purchase system where vehicles are bought and sold directly. It boasts the largest nationwide network of 47 direct-operated locations (as of April 2024) and has introduced the e-commerce service ‘Home Service for Buying My Car’.
The Home Service for Buying My Car, launched in 2016 as the first in the industry, has grown every year, accounting for more than half of total retail sales. It holds an approximate 81% market share in the domestic used car e-commerce market (2022, source: Frost & Sullivan), solidifying its position as a leader in the automotive e-commerce sector. As a result of continuous innovation in the used car market, K Car has won the title of the best-used car distribution company for five consecutive years at the 2024 Korea First Brand Awards.
Lee Sang-jin daedusj@autodiary.kr