Growing web population boosts online car trading

CEBU, Philippines - The success of online business has been proven.

In the Philippines, online players believe the growing web population and smartphone market show good prospects for the digital enterprise.

 For online car dealer Carmudi, the growth of e-commerce business suggests the web offers market opportunities.

 Subir Lohani, managing director of Carmudi Philippines, said the country has a very big advantage in online trading because of its young population and the rising number of people using mobile phones.

 Lohani cited in particular online car trading which has become popular and has supported the Philippine auto industry.

 "Definitely, we have a growing middle class," he told The FREEMAN in a phone interview Thursday. "People are buying cars and banks are becoming aggressive in offering car loans, which makes cars more affordable."

 Carmudi, supported by German start-up incubator Rocket Internet, is confident the local car industry will continue to post good sales, crediting to the rising demand and improving buying power of middle class citizens. Carmudi is a web market where car buyers, sellers and dealers trade private and commercial vehicles.

 "We are excited for the local automotive industry as sales remain resilient and steady," he noted. Philippine car sales hit a 30 percent growth rate in 2014 to 234,747 units from 181,283 units in 2013. Strong demand from the motoring public and the nation's economic growth are factors seen to have hike sales.

 The Chamber of Automotive Manufacturers of the Philippines Inc said the growth is also attributed to new model introductions, aggressive promotions and rising consumer demand.

 Lohani explained these factors have helped the business of Carmudi which started in the country in January 2014.

 It currently has close to 25,000 cars in its inventory listings from over 1,000 dealers nationwide and has 500,000 views a month. Globally, it has 250,000 current listings, 9,000 of which are car dealers. Locally, it has offices in Manila and Cebu but plans to establish office in other areas where car demand and sales are high, he said.

Funding

 The online firm has secured $10 million in funding from its investors. The funds, he said, would be used for expansion in Asia, citing the Philippines as a priority market.

 The company generates income from fees charged on dealers.

 "We charged the dealers of vehicles per month for the number of photos and content they want to put up," he said. "You can think of it like a subscription model of revenue."

 The official, however, declined to reveal how much the firm earned in revenues last year. He though mentioned that every dealer has an average 50 cars being sold online and has to pay for each listing.  (FREEMAN)