diff --git a/src/libfetchers/git-utils.cc b/src/libfetchers/git-utils.cc
index fecceeffffe..115539e6b6a 100644
--- a/src/libfetchers/git-utils.cc
+++ b/src/libfetchers/git-utils.cc
@@ -1427,7 +1427,11 @@ namespace fetchers {
 
 ref<GitRepo> Settings::getTarballCache() const
 {
-    static auto repoDir = std::filesystem::path(getCacheDir()) / "tarball-cache";
+    /* v1: Had either only loose objects or thin packfiles referring to loose objects
+     * v2: Must have only packfiles with no loose objects. Should get repacked periodically
+     * for optimal packfiles.
+     */
+    static auto repoDir = std::filesystem::path(getCacheDir()) / "tarball-cache-v2";
     return GitRepo::openRepo(repoDir, /*create=*/true, /*bare=*/true, /*packfilesOnly=*/true);
 }