Covid-19 appears to bring a boon for a used car industry. As the pandemic has prompted many factories around the world to slow down new car production, the demand for used vehicles has been rising in the wake of the outbreak. Health concern over mass transit and ride hailing service gives people another reason to take a second look at used cars.
However, there remains a barrier when it comes to purchasing nice second-hand cars. It has always been the market where sellers, or dealerships, know better than buyers. The information disparity between dealerships and buyers has made it difficult for buyers to screen vehicles with hidden defects.
According to a November survey by The Federation of Korean Industries, about 80 percent of the respondents said the country’s used car market system is “backward.” Lack of confidence in pricing system and risk of car-buying scams with a fake list were cited as major reasons for perpetuating distrust in used-car dealerships.
Hyundai Capital CHECK service
Pioneering the efforts to avoid picking lemon cars during the pandemic era is Hyundai Capital, a financial arm of Hyundai Motor Group in Seoul. Operating under the names of “Hyundai Finance,” “Kia Finance” or “Genesis Finance” in countries outside Korea, the company is running auto financing business in 11 countries around the world.
Having gained popularity for its advanced vehicle inspection system called Certified Pre-Owned (CPO) car program in Korea and the US, Hyundai Capital has been scrambling to establish a comprehensive digital platform at a time when consumers seek to avoid in-person interaction for used car shopping.
Hyundai Capital’s efforts to provide safe and convenient way of purchasing nice used cars is epitomized by “CHECK Service” for prospective used-car buyers. Ranging from vehicle inspection, price referencing to loan application, the CHECK Service allows consumers to complete virtually any process online before purchasing cars.
“It’s like an all-in-one service for used car buyers,” said a Hyundai Capital spokesperson. “Through CHECK Service, the consumers can check out whether the vehicles they want to purchase really exists in dealerships and how much they should pay to purchase them.”
When a prospective used car buyer types in a car plate number on the query at the CHECK Service website, whether the vehicle in question really exists at dealerships is shown. The chance of getting into fraudulent deals is virtually zero, because the result comes from legitimate data collected by almost all dealerships across Korea.
Using an AI algorithm Hyundai Capital has developed jointly with Seoul National University, the program offers an ideal price for a specific vehicle that a prospective buyer has in mind. The buyer may also see whether the AI-calculated price is appropriate, as the program shows how much other buyers paid for the same model with similar features including mileage and age.
Once the buyers complete price comparison and decide to purchase specific cars, they can choose what would be the best payment options. The consumers can choose from lease and installment plans and calculate specific amount of financial burden depending on their financial status.
“With massive data pool and advanced analytic technology, we are seeking to help consumers find the best deals and provide customized financial service,” said a Hyundai Capital spokesperson. “Our ultimate goal is to provide better consumer experience and innovate used-car ecosystem.”