Prediction of Resale Value of Pre-Owned Luxury Cars in the Indian Market Employing Machine Learning Techniques

Abstract

Abstract: The market for second-hand luxury cars in India is witnessing a significant surge, expected to grow at a rate of 16.30% from 2024 to 2032. This growth is fueled by increased car manufacturing, rising disposable incomes, and a shift in consumer preferences towards luxury brands. However, accurately determining the resale value of these vehicles presents a challenge due to various influencing factors. In this dynamic market, informed decision-making is crucial for luxury car buyers. Digital platforms have revolutionized access to real-time market data, helping both buyers and sellers stay updated on pricing trends. Our research explores the complexities of predicting prices for pre-owned luxury cars and introduces a predictive analytics framework using advanced machine learning algorithms. We collected and preprocessed a comprehensive dataset and conducted an in-depth exploratory data analysis. Various regression techniques, including Linear Regression, Decision Tree, Random Forest, and Extreme Gradient Boosting, were employed to forecast prices. These models were evaluated using metrics such as Mean Absolute Error (MAE), Mean Squared Error (MSE), and Root Mean Squared Error (RMSE) to identify the most accurate predictive model. This study offers a systematic solution for price prediction, enhancing the buying process for stakeholders in the second-hand luxury car market