A Deep Dive Into The Proton Certified Pre-Owned (PCPO) Vehicle Program

Buyers of new Proton vehicles will soon have an additional option when it comes to selling their existing vehicles with Proton’s new Certified Pre-Owned Program (PCPO).

This new initiative by Proton – which follows in the footsteps of manufactures such as BMW and Toyota – provides a closed-loop ecosystem for new customers and allows them to tap into higher selling prices for their trade-in before they drive off with their new Proton purchase.

Proton on the other hand – see this as a crucial component in their effort to streamline the sales and distribution of used cars in support of new car sales. 

Separately, they also hope the initiative will set a benchmark with regard to the used value prices of their vehicles, which despite their formidable numbers and intrinsic reliability – does not enjoy similar value retention rates as brands such as Toyota, Honda, and its closest neighbour, Perodua.

Proton’s Used Car Management program, or UCM for short, has been in a pilot phase for approximately a year, and now come full circle with the official introduction of the Proton Certified Pre-Owned (PCPO) website which offers the 36 selected UCM dealers nationwide the appropriate platform to list, advertise, and sell their approved pre-owned vehicles.

Other features of the website include will include functions where customers can upload pictures and necessary information of the car they wish to trade-in (in much the same way of most online classifieds) and request for a tentative quote Proton. This allows customers to better plan their purchase, knowing how much they will be able to sell their current car for.

Proton’s main target set for the UCM program is replacement sales, where a current owner trades in a Proton model for a new one, to account for a minimum of 10 percent of the volume for outlets with UCM operations. The UCM comes on the backs of other programs such as the ‘Proton Xchange’ which allows current owners to replace their current cars with new models.

Cars sold by UCM will be marketed under the Proton Certified Pre-Owned banner, which will be listed and updated frequently on the PCPO website. Here’s a shortlist of the requirements for trade-in vehicles to qualify for the PCPO program:

• Cars under 7-years of age
• and, having a maximum mileage at the time of trade-in, of under 130,000km

All PCPO vehicles undergo a comprehensive 201-point inspection and are guaranteed to have never suffered any flood or major accident structural damage. They also get a 1-year extended warranty covering the engine and transmission and are eligible for a one-time free service (engine oil and oil filter only), up to 6 months after their registration date.

We recently sat down with Brian Cheah, Head of Used Car Management program and his team for a deep dive into their UCM program and near-future goals, here’s what we learnt:

• What are your major objectives with the PCPO program?

In short, the PCPO program is a vital cog in our efforts to stabilise and increase the value of used Proton vehicles, by setting a benchmark (in terms of prices and vehicle condition) with our PCPO cars and providing another option for our customers to dispose of their current vehicle. Secondly, it is to institute best practices in terms of our transparency and streamlined processes when trading-in cars. Finally, it also offers our UCM dealers and the company alike with a new revenue stream, by tapping into the used car market.

• You went from 8 UCM dealers in the pilot phase to the current 36 UCM dealers, how do you qualify your dealers (and their relative success) with the PCPO program?

The initial criteria for dealers were for them to be committed to the processes we had set up for the PCPO, and have the resources (such as a 3S/4S dealership or to transition to a 3S/4S dealership) to trade-in these vehicles, conclude the necessary ownership transfers, and prepare the cars for resale at the required standards. For the near future, we hope to meet our targets of 10 percent replacement sales (i.e.: customers trade-in an older Proton for a new one) for all our UCM dealers.

In growing from 8 to 36 dealers, we felt that 36 UCM dealers are adequate to achieve our current goals, and we are currently focussing on growing the portfolio of vehicles rather than simply expanding the network, without the necessary steps to ensure quality and transparency.

• Are customers allowed to trade-in other makes and models or just Proton vehicles?

Yes, customers are allowed different makes and models, as long as they conform to our age and mileage criteria, and pass the necessary inspections. For cars that do not conform to the required criteria, dealers can still opt to trade-in and resell the vehicle, but it will not carry the extended warranty from Proton Edar. So far, all the cars we have sold have the warranty in place.

Additionally, with the UCM program, we are trying to emphasise and make mandatory, what we call “genuine trade-ins” this means, when the dealer trades-in the vehicle, the ownership must be transferred to the dealer/principal, and all outstanding finances, summons, etc. be settled before the customer concludes the deal on the new car. So it’s not just about taking in your existing car, it’s about giving the customers a trusted and transparent touchpoint with regards to the ownership transfer.

• How do you incentivise your dealers to use your UCM program, are they given special rebates, etc. especially when they still have the option of disposal-in of the trade-in car to 3rd party used car dealers?

We do not incentivise our dealers in terms of monetary gains, the UCM program provides an overtrade mechanism (on top of other promotional offers) which allows some freedom to the dealers to offer more value to be passed down to the customers, which provides an additional incentive for the customer to buy a Proton versus a competitor brand.

We also expect that the overall transparency and peace of mind the UCM program offers, will make customers want to trade-in their cars with Proton, and hence buy new cars from us as well.

• What are your long-term goals for the PCPO and to a larger extent your UCM program?

The main pillars of the UCM are as I have said, to offer a reference point to stabilise and improve the overall resale value of Proton cars. However, in the long run, we hope the UCM will be a pivotal mechanism to improving the perception of the buying public towards used Proton vehicles, and from an internal perspective, to improve the financial platforms of Proton as a whole.

In terms of financing options, and credit scoring – we hope the UCM will have a net positive effect on how our cars are rated by the banks and this will further fit into our larger ecosystem of buying and selling cars.