Automotive

Published on May 11th, 2018 | by Subhash Nair

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What Do We Want Out of The Car Industry Under A New Government?

GE14’s results were historical. I think I speak for many Malaysians when I say that there’s finally a sense of freedom and agency. It feels like we can finally have our voices heard and for sensible decisions to be made at a grassroots level.

So, as a stakeholder of the car industry, what do I feel I want out of the car industry? These are just some of my initial thoughts about what should happen. I have others, just not the time to write them all out.

Decreased Role of Government Agencies and More Impartiality 

Well, I for one think the most healthy thing for the system would be transparency. If the government and the car industry could cut down the red tape and behind-the-scenes deals, competition between brands would be a LOT fairer. Right now, different companies allow for different amounts of transparency. This means that a lot of deals happen without any paper trail. Why not make applications straightforward, more digitalised, and less personal? Why do we need a Malaysian Automotive Institute under the Ministry of Trade and Industry to form unofficial partnerships with car companies? It’s absurd. Government bodies don’t need to be so involved with business on a personal level. Set the rules as clear-cut as possible. If the companies abide by them, if the numbers make sense, then give them approval. It should be that clear-cut and simple.

Instead, companies have to submit information about local assembly, emissions testing, etc and then wait for an answer on whether their cars will be granted E.E.V. status. In fact, every company we’ve spoken to seems to have a slightly different experience with MAI. Why can’t this process be automated and simpler?  Why can’t the numbers be calculated and known by car companies BEFORE even submitting the papers? Wouldn’t that be a lot easier?

New Car Tariffs and Pricing Should Come Down VERY Slowly

In terms of new car pricing, I know a lot of Malaysians, myself included, think car prices are insane. Protectionist measures are still in place, 30 years after Proton’s inception and nearly a year after Proton got itself a foreign strategic partner (more on this later, by the way). Well, we actually don’t think drastic measures need to be put in place immediately. Car companies have already done a lot of calculations and costing based on current trends and prices.

If prices were to suddenly be slashed, it’s not just the car companies that would suffer, but the used car market as well as anyone who has recently purchased a car at full price. The responsible thing to do would be to gradually introduce healthier and more competitive measures over the next 5 years. Cars sold today are better equipped, better driving, better looking and safer than ever before, and in the region, we’re still getting reasonable value for money, it is still very reasonable for people to continue buying cars without worrying about what policies will come in place tomorrow. Little by little, prices should come down to give all parties and the market time to adjust.

Proton should soldier on under Geely

I think a lot of Malaysians are under a very wrong impression about Geely. I don’t blame them. The Chinese car market is another world. It makes up for something like 25% of global sales, so within its borders car culture is completely different. That being said, there’s something about Geely that I think Malaysian car fans will appreciate. A lot of car brands in China are sort of government-linked. This includes some of their biggest. Geely is different. Geely is privately owned by Mr. Li Shufu and not long ago they were just another Chinese carmaker competing against dozens of others.

But Mr. Li realised that the market was changing, both globally and within China. Instead of outright buying global talent and expecting them to be passionate about a Chinese brand, he instead treats the brands under Geely Auto as partners. So, Volvo Cars has complete autonomy, Lynk & Co has complete autonomy. But at the same time, he uses their technology and processes to improve his other brands. It’s a strategy that’s never been done before, not even by the Hyundai-Kia Group. Proton stands to really benefit from this method of doing things because it’s clear that Geely knows how to play to each brand’s strengths. I think Proton will do great under Geely. They finally have the tech, will and potential volume to be a South East Asian brand, and not just a local brand.

There’s so much more that needs to be done. What we hope is that Malaysians who are passionate about the industry finally feel that sense of agency to make changes happen. We hope that politics and financial interests no longer get in the way of our potential. And more than anything, we hope for greater freedom for members of the press and commentators like ourselves.


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