THE minister of international trade and industry was quoted as saying that while it was necessary to give some recognition to develop national cars, it should not be at the expense of the whole industry.

He also commented on Proton’s vendor system where a study showed that the component costs were 50% higher than in Japan.

I can tell him why the prices of Proton components are more expensive than in Japan. The Proton vendors are acting like a cartel.

Knowing that they are protected by the National Automotive Policy, they artificially maintain the higher prices. Collectively, these vendors manage to make higher profit margins at the expense of Proton.

Having Proton as a national project is good, having an indigenous automotive industry is good. However, some of the ways in which Proton is made to manage its business is strangling itself.

Maybe, the government and ACA should look at those Proton vendors. Find out how they operate, who are the real owners and benefactors, maybe then, answers could be obtained.

Adri Hemy Abdul Ghani
Saudi Arabia

Source: The Sun – July 18, 2008