A consumer group said on Monday that large automakers should be allowed to enter the secondhand car market where consumers are suffering due to opaque pricing and insufficient after-sales maintenance service.

Nearly 2.52 million used cars are sold annually in South Korea -- 1.32 times the sales volume of new cars -- and over 55 percent of those sales are direct transactions between individuals.

The reason direct sales account for a huge chunk of the market is because there is no competitive and trustworthy used car company; secondhand cars are considered to be low quality; and their pricing lacks standards, Kwak Eun-kyung, chief of Consumer Watch, said in a forum hosted by the Korea Automotive Industry Alliance.

“No company guarantees or receives detailed information on history of accidents, flood damages or engine defects, and consumer damages due to false offers have also been reported,” Kwak said.

“Used cars need a solid after-sales maintenance service system as they have a higher risk of breakdown, but dealers are trying avoid compensation with unreasonable conditions like offering service for only defects reported within a month after the purchase.”

Consumers are often cheated by dealers, or scammed as they try to buy directly because they can’t trust the dealerships, Kwak added.

A state-run consumer consultation center received calls for 18,002 cases of secondhand car-related consultation from 2019 through October this year, the highest number for products that cost over 10 million won.

Citing data from Rep. Yoo Dong-soo of the ruling Democratic Party, Kwak said 554,564 cases of used car sales scam amounting to some 290 billion won were reported from 2014 through last year, which means a daily average of 217 such cases were reported.

“For the benefit of consumers, we need large companies that have established strong quality management and after-sales service systems in the secondhand car market as they are the best at assessing vehicle performance and history of accidents,” she said, adding that the government should promptly complete its review on the issue of allowing automakers enter the used car business.

Jung Man-ki, chairman of KAIA, said all advanced countries allow carmakers to take part in the used car market because it not only benefits consumers but also increases business opportunities for secondhand car dealers, makes automakers more competitive and expands the auto parts market.

Kim Pil-soo, professor at Daelim University, said the Ministry of SMEs and Startups was still sitting on its hands when two years have passed since a state-led commission on corporate partnership declared used car sales unfit as something large companies should be barred from.