Mexico has a new player in the market for selling used cars online. In a booming sector thanks to a shortage of chips for the manufacture of new cars, Caranty it wants to compete against other companies like Kavak, the first Mexican unicorn, or like OLX. But the main objective of the company 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 pre-owned cars between individuals. Unlike Poplar, which buys cars and then sells them, Caranty offers a transparent channel between buyers and sellers to carry out their transactions safely, which also differentiates it from second-hand notices, as it performs legal and technical checks before advertising any vehicle and is in charge of delivering the money to the seller when the car has been delivered.
Both Caranty and its investors and executives are taking advantage of the boom in the pre-owned 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 due to the high demand for this type of goods. In the United States, used car and truck prices increased by 37.3% annually in 2021.
For Miguel Bulnes, CEO 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 of value of your car or you take 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 .
rodrigo.riquelme@eleconomista.mx