Two Southeast Asian used-car sale platforms have received venture capital funding this week, bringing more attention to the used-vehicle growth in that region.
Carousell, the Singapore-based mobile listing service for private-party transactions across Southeast Asia, announced the close of an $85 million Series C fund today. At the same time, fellow Singapore-based automotive marketplace Carro also announced a Series B funding of $60 million.
While Carousell, as a whole, is not exclusively limited to vehicle sales, it did launch a dedicated vertical called Carousell Motors in February 2017, and has also expanded its business to include financial services according to TechCrunch. Other startups in Southeast Asia focusing on used vehicles have also closed funding round in recent months including Carmudi, Carsome, and BeliMobileGue.
According to market research firm BMI Research, vehicle sales in Southeast Asia were higher by volume than anywhere else in the world last year. Total new vehicle sales in the region were projected to grow 8.1% in 2017, more than double the 3.7% for Asia as a whole. This influx of sales is setting the region up for a boom of second-hand sales in the coming years.
Carro’s online marketplace uses proprietary pricing algorithms to inspect and evaluate vehicles. The company claims that this improves the used-car trade by giving buyers and sellers a pricing system and transactional framework they can trust. As Auto Finance News has previously reported, a large central issue with used-car sales throughout Asia is a lack of a cohesive framework for assessing collateral values and various competing companies utilize different standards.
Carro also provides buyers with after-sale care, including roadside assistance, as well as lending and insurance options through its Genie Financial Services unit, which it claims is already profitable in a public announcement. Carro said that its vehicle marketplace handled transactions totaling more than $250 million last year and that Genie facilitated $100 million in loans — $40 million of which were originated by Genie itself.
The Series B funding will be used to “double down on our online marketplaces and financing in emerging markets,” Aaron Tan, founder and chief executive, said in the announcement.
Meanwhile,Carousell is using its funding to solidify its presence in Southeast Asia, and in particular, expanding its premium offerings — including automotive — beyond Singapore and into markets like Indonesia and Thailand. The startup is also looking to grow its engineering team to develop AI capabilities in order to match buyers and sellers.
To date, the Carousell platform has helped sell over 50 million items and today it has 144 million listings.