SECOND hand car dealers have digitised their services in order to compete with new vehicle sales and take the market to consumers through social media, said industry players.

The Federation of Motor and Credit Companies Associations of Malaysia (FMCCAM) president Tony Khor said while second hand car dealers still hold the biggest market share in the car market, they will stand to lose out in the long run if they don’t adapt to technology.

The industry has been steadily digitalising, with car dealers embracing the internet of things starting in 2011 through the eAuto platform.“In 2011 we already had a technology partner called eAuto. It digitised all the used car dealers,” Khor told The Malaysian Insight.

“All transactions have been transformed from manual to digital. This benefits the dealer and reduces the hassle for customers who have to line up and be present at the Road Transport Department.”

Through the platform, all of FMCCAM’s used car and new car dealers are able to transact 90,000 vehicles a month.

The association represents 4,600 companies with 7,000 outlets nationwide.Following eAuto, in 2019, FMCCAM introduced another platform called EZ Auto to help dealers become fully digitalised from sourcing, managing sales and marketing, customer relationship, accounting, social media and digitalisation of marketing.

“We provide the platform as a service and it also provides training to our 4,600 members. An estimated 70,000 sales and management personnel have embraced this digitising to re-skill and up-skill themselves,” Khor said.

Currently, the association’s members are responsible for 90% of used cars sales. The remaining 10% are sold through platforms such as Carsome, My Tukar, social media and the physical marketplace.

Better consumer protection

Khor said they have the digital platforms to help with the sale of used cars, the association is working with the Ministry of Domestic Trade and Consumer Affairs, insurance agencies as well as consumer protection groups to roll out a customer protection programme.

“It’s in its final stage. We are negotiating with the bank, government and consumer bodies for better protection for buyers and sellers.

“If a customer wants to buy a used car, they can request a full 170 point report to get detailed information on the vehicle.

“We also tied up with the ministry and rolled out a one year parts warranty for members backed by the insurance company. This is to enhance and give better confidence for customers buying second hand cars.

“We understand if the association does not consolidate all our members to work hard on digitalisation, our members may be facing difficulty for the sustainability of the group,” Khoo said.

The future is bright

Having embraced a customer centric approach, Khor said in the next five to ten years, he expects the used car industry to grow in double digits.

“With many of the big companies involved in the marketplace, we foresee that the sale will increase as it (the process) is more transparent.

“Very have a good future and can grow by double digits in the coming five years.”

This is in contrast to the last 30 years where used car sales have remained stagnant at 40,000 units per year, Khor said.

“With online, marketplace and social media, it is looking up. The trend is going up. I hope they can go for 8% growth per annum.”

Internationally, the used car industry in Malaysia is also getting attention, Khor added.

“Internationally countries are also looking into entering ASEAN. Some are based in Singapore, they want to penetrate Malaysia before moving to other countries like Indonesia.

“Mexico, India, US and China used car dealers have also shown interest in Malaysia.

“We have to work very closely, upgrade, upsell, embrace technology, 5G and the Industry Revolution 4.0. We have no choice, its do or die.” – February 14, 2022.