Tread carefully on 3rd national car, says economist

KUALA LUMPUR: An economist today voiced concern over the third national car project proposed by Prime Minister Dr Mahathir Mohamad.

Universiti Malaya’s Edmund Terence Gomez said he had his reservations about the project, even if it was an electric car.

“It is a really high technological sector, and I am looking at domestic firms. How many firms have that kind of technological knowledge?

“I would tread very carefully. I think we need to do a proper assessment of the sector before we make a firm decision on it,” he told reporters on the sidelines of the China Conference organised by the South China Morning Post.

Gomez added however that he also believed Mahathir had learnt from past problems, having gone to Indonesia and spoken to its president Joko Widodo.

“The issue of market size is also important,” he said. “He has learnt from past mistakes. He has been talking to other countries about implementing this project.”

Calling Mahathir “a man of ideas”, Gomez nonetheless maintained his doubts about the project.

“What I will do is to listen to what he has to say and then do a proper assessment,” he said.

He also questioned the government’s two-year timeline to roll out the new car, calling it ambitious.

“I’m worried about that – the speed at which they want to roll it out. I would like to know if fellow Cabinet members also approve.

“Is there a consensus? I think there will be division among members of the current government,” he said.

He spoke of the first national car project, saying Proton had not done very well.

“I’m also aware that we have Perodua, and Perodua did well. The nature of the ownership patterns of Perodua and Proton are different, but in both cases there is government ownership,” he said, adding however that Perodua had more private firms running the show.

“That’s why I said if there is a third car project, I would look at it very carefully – the conditions under which it is established, the lessons from both Perodua and Proton, and other issues like market size and the technological base to develop this project.

“These are complex issues to be looked at.”

He suggested that an open debate be held for all facts to be put on the table before any decision is made, to assess the viability of the project.

Entrepreneur Development Minister Mohd Redzuan Yusof reportedly said the new national car project was expected to roll out its first model before 2020.

He said the semi-autonomous car was planned for entry into the global market and would cater to the demand from young people.

“We are now short-listing two to three partners to participate in this project, including Silterra and CTRM, and expect (the selection) to be concluded by year-end.

“The prototype for this (car) model is expected to be ready by early next year,” he said.

Meanwhile, Khazanah Nasional Bhd managing director Shahril Ridza Ridzuan said there had not been any allocations for a third national car.

“No real decisions have been made yet,” he said. “The government, to be fair to it, is still in the process of studying whether the concept of a third national car is viable.”

If the project took off, he said, private companies that produce parts, computer chips and sensors for the automation industry would be “natural suppliers”.

However, he reiterated that the country was still some distance away from producing a third national car.