asean automotive

Some market snippets.........

2006-02-05T15:43:00.000-08:00

Again I apologize for not updating the blog. A severe time constraint has diverted my passion towards blogging to catching up things as fast as possible. I am still in tune with the auto market though, keeping abreast with the likes of Smart, GM's and even Proton. Speaking abt Proton, it is certainly the most talked about stories in Malaysian automotive scene at the moment.

Proton recovery imminent?

To address the waning interest of Proton cars and to stem the further slide in market share and stock prices, Proton has undertaken fresh inititaives under the helm of the new CEO. Proton has collaborated with almost everybody in the auto industry. The alliance with VW has been revived, partnership with Mitsubishi would resume, engine sourcing from Petronas is happening and entry into China and Indian market is imminent. It is heartening to see some things in place, and now lets see some actions.

Others gaining momentum?

Alfa Romeo has started to beef up its sales initiatives beginning with enhancing its parts and services division. A good move indeed - when the brand is plagued by issue of parts unavailability and slipshod servicing.

China makers are starting to become impatient, not just in the US market. Chan An is expected to assemble its small car/minivan to compete with the perennial leader, Avanza. Prices are one thing, but ML consumers are becoming more discerning these days. So quality counts at the end of the day.

Excerpts of REAL customer complaints at XXXXX Malaysia .....

2006-01-03T02:05:00.000-08:00

Hi auto folks !!! A happy new year to all of U - let's join forces in turning 2006 into a bumper year for the industry players in general - not just in Malaysia. Recently, well today actually I had this privilege of sifting through actual customer grievances in the form of emails and letters addressed to an established auto maker in Malaysia. I have decided to keep mum on the name of the manufacturer at this juncture. Bear in mind that some of the points raised in the letters are a bit biased in that they are closely related to traditional Malaysian attitude and service culture - You gotta Be Here Done That to really grasp the euphemism. Enjoy .........

1. Complaint about the steering wheel
" Could you please give me a very good service center that I can go to without them telling me - biasalah, cik, steering semua kereta mesti senget punya ( its common for all cars to have slightly misaligned steering)" - What a load of crap, if it does then the automaker would see a horde of irate owners storming the service centers or corporate office for an imperfect fitment!!!

2. Complaint on ride and handling on a van
" .........when you drive over a road surface which are not totally flat and even such as wavy pattern-like roads, the last row and center row passengers can feel like they are in a rough sea, very uncomfortable. " - This guy must be a sea farer used to ship/boat rides or a first hand driving experience in a van with old fashioned leaf springs

3. Complaint on bad service experience
" ... I had a bad experience with a lady who not only didn't smile but also give details very fast as though she was forced to work here. She was not courteous at all. It makes sending your car for service matters there like going to one of those government offices." Hmmmm, surprisingly this email complaint actually came from someone working in one of the government organizations in Malaysia. Even she admitted that there are service deficiencies in the government. Remember the old adage - as the wheel turns ---------ahh forget something like it would hit you back !!!!

Those are some that of the comments that I find pretty amusing. Some complaints are legitimate while some are baseless- carried by folks out there intending to make quick bucks. Those legitimate whiners are sometimes unlucky - being tossed around like rubber balls by the cust. service team. That is pitiful - considering that these customers are doing the management justice by telling them areas that need improvement ................

Proton's Italian fiasco......

2005-12-27T16:56:00.000-08:00

At first, the stake in MV Augusta was like a dream come true for Proton - having acquired world class engineering capabilities in two wheeler production and blending them into Proton's 4 wheel product line up. Vehicles renowned for their engineering prowess would always be the mainstay of Proton - and the move was a baby step forward. Proton endeavours to stay clear of the mass market car concept championed by low cost producers - China.

The strategy turned out to be otherwise. What is meant to be the nation's joy and shareholder pleaser was indeed a loser. Proton has decided to bite the bullet and dispose of its stake in MV Augusta as it was responsible for the bulk of the red ink in Proton. What went wrong here? The inept Augusta's management team to turn around things under the helm of Proton or the hand wringing and prognosticating attitude of Proton team to run full steam? Has Proton managed to learn a thing or two about bike technology during a the short stint to be applied towards car making or are they too engrossed in dressing up outdated car models to rejuvenate customers interest?

An attitude shift needed when assembling S class

2005-12-18T16:19:00.000-08:00

Daimler Chrysler Malaysia has decided to invest in the assembling of its latest luxury liner - the S class type in Pekan Pahang Malaysia upon launcing its multi million Auto haus showroom here in Petaling Jaya. A joy indeed to the fledgling assembly industry which has been harboured by news of losing out to Thailand for lucrative assembly contracts.

As the S class is considered the premium line for Mercedes Benz, Malaysians involved need to undergo a 360 degree mindset change. Ditto for the lackadaisical attitude prevalent in the manufacturing of trucks or cars that put quality in the backseat (if what those workers perceive). This is make or break time for DRB Hicom assembly business. Achievement garnered which is devoid of glitches and quality slipshods would go a long way in transforming Malaysia into the hub of assembly activities. This is what Daimler Chrysler is pinning its hopes in Malaysia - to seek an alternative from the highest auto industry labor cost structure in the world that is in Germany.

Discord which tend to impair quality and affect car choice.....

2005-12-13T23:23:00.000-08:00

The bickering between unionized workers of Delphi and Delphi's top management is ongoing albeit at a less harsher note. What is feared most is that those lengthy and heated discussion would eventually lead to strike - something that Delphi and its customers could ill afford at this juncture. A strike would cause serious repercussions not only to Delphi workers but also to its customers mainly GM (constitute about 50 % fo Delphi's sales revenues) and Toyota.

Sometimes I just paused to ponder at my workstation here in Malaysia ........... how could workers engrossed with the thought of job insecurity could graciously move along the production line and churn out defect free automotive parts. When loyalty to a company diminishes doesn't it shows on the quality of the product? I am pretty sure the customers (vehicle makers) have to exercise extra vigilance during this trying times to ensure that Delphi parts fitted into every model make the grade. As for the vehicle purchasers, shunning models that have a significant percentage of Delphi DNA in them is a wise move - at least until the house is back to orderly manner.

Quality can sometimes mean brutal.......

2005-12-08T01:33:00.000-08:00

Put the customers in the automotive production line.... they are going to freak out. The presence of Quality Gate centers in every division of auto production , be it paint, trim and body line, assembly can send shivers to the spine to first time lookers. Those harsh banging and knocking tend to mimic a scene in professional wrestling.

In the auto production world, those actions are there for a reason. QUALITY. To ensure a perfect fit and to uphold the quality disciples, QC workers continuously wrestle with the fitted parts. No wimpy parts that hang loosely or perish under heavy or repeated usage. And there is no reason to drive a hard bargain with the customers once quality receives a back seat.

A career progression?????

2005-12-04T21:28:00.000-08:00

I am back again this time. Sorry for not updating the blog. I am too preoccupied with my new job and my new role as a Research Manager at a Japanese automotive company in Malaysia. I will be bringing along my analytical skills developed for five years at Frost & Sullivan, a US based consulting firm. Such high expectations they put one me in that they want the whole research division revamped under my tutelage. Not much difference, it is just that everything is so structured and so regimented mainly in a Japanese organization. I miss those flexibility associated with an American company.

Nevertheless, the ball is under my game. I am expected to be out of the box thinker - thinking new ways to make things better. At least I am paid to do what I love - thinking strategically and implementing changes that benefit all. As long as I am allowed to voice my insights in this blog, I have no reasons to complain. Look forward to sending more manufacturer related stories on the web !!!

A fervent hope for car navigation system in ASEAN?

2005-11-23T16:26:00.000-08:00

Fujitsu Ten Thailand - one of the leading automotive audio manufacturers in the world has stepped up its investment in Thailand, this time to concentrate more on high tech audio devices which includes vehicle navigation system for passenger cars. It is taking advantage of ASEAN, a new hotbed for automotive manufacturing activities, which continues to chalk up constant vehicle sales growth amid increasing prosperity.

The recent move by Fujitsu Ten has reinforced the notion that ASEAN consumers are becoming more tech conscious - with a feel for high end audio system and a curiosity towards in car vehicle navigation. The shift in consumer trend is due to the severity of traffic condition and the sprouting of new places of interest in newly developed areas in ASEAN cities. In-vehicle pleasures to cheer people up during traffic snarls and talking roadmaps to contain mad outburst while navigating through streets that practically undergo transformation overnight are some of the essential driving tools.

The main catch here is the vehicle navigation system which until recently has been the subject of interest among high tech purveyors in the auto industry. Maybe it would be more feasible for Fujitsu to have a vehicle navigation system that transcends borders - from Thailand to Singapore, rather than constrained to a particular country. Then we could have cars that greet and deliver instructions in Thai, English, Malay and Mandarin. Isn't it called a form of integration and a step towards full AFTA compliance?

Proton diesel car? SUV? Mini MPV?

2005-11-21T00:00:00.000-08:00

Is Proton developing a new product? - No, definitely not the Juara facelift... could be a diesel version of Proton cars for the local and export market on the cards. If it is really diesel, is the model going to be a rebadged VW or a model culminated out of Proton + Lotus + Mitsubishi love triangle?

One of Proton's premier suppliers - Bosch, who is responsible for gizmos like engine management, brake systems and a variety of motors in Proton cars, has been in talks recently with Proton about the idea of incorporating diesel fuel injection system in future Proton projects. Talk about Proton's future cars running on diesel fuel. Can you believe that an autoparts behemoth like Bosch is placing its bet on Proton? Furthermore, the optimism displayed by Bosch indicates that Bosch might have foreseen bigger things in the offing for Proton (maybe through their fellow countrymen VW) that the others are virtually clueless?

So how about you Proton lambasters and naysayers? Don't you guys realize that if an established giant is so confident with Proton you critics armed with shallow knowledge about Proton's strategic plans should do the same?(HaHa). Definitely, Proton should just go ahead with the diesel plans .......it is running out of creative juices and does not have the luxury of toying with failures. If a supplier is willing to lend support - just go for it, for god's sake. Hopefully the new CEO - apparently free from Proton instilled bias common among Proton laggards, would give a greenlight to this initiative.

This proposed move would benefit both parties. As the Malaysian government is racing to seek measures to reduce the nations's energy bill and its dependence on fuel, such endeavour by Proton may detract or at least lessen the government's stance towards Proton. By doing its part, maybe those preferential duties given during the heydays of Proton would resurface (Ha Ha) to the aghast of non national players and off course the THAIS. In reality, at least some form of financial incentives under the New Automotive Policy would be accorded if Proton participates. But Proton would be further rewarded if they take part in the bio-diesel program, a much publicized effort by the government to promote bio-diesel as an alternative to pure diesel.
A subsidized diesel vehicle which is likely to ensue may increase diesel vehicle usage and penetration in Malaysian market. A welcome boost towards Proton's precarious future.

Besides, Proton is inching towards the EU market if all goes well with the diesel project. Other than the tie up with VW to gain inroads into the EU market - diesel incorporated cars would make the accession into the EU market a breeze as diesel run vehicles are more popular there in the EU. A fortuitious move to expand the horizon by Proton finally.

As for Bosch, if such plan materializes, it would fortify Bosch's position in the Malaysian OEM market and the diesel market subsequently. This could help break the traditional Japanese stronghold in a country or region where Japanese presence in all automotive areas is well entrenched. This could also serves as a platform to penetrate the pickup truck market in Thailand which uses mainly Japanese diesel injection system.

Banking on technological advances is deemed the right move for Bosch, which considers technology as its core competency. Bosch has finally understood the local Malaysian market by introducing fresh and modern technologies that the public craves about rather than pushing for aftermarket parts in a market where choices are aplenty and prices are rock bottom. Hopefully, Bosch would get it right this time.

More is expected out of a small compact

2005-11-16T18:10:00.000-08:00

Buyers are more finicky these days. No longer could manufacturers dump a sheet pile of junk or outdated engine parts into a small compact and tout them as affordable, economical mode of transport.

Small compacts need to have the characteristics, features, performance attributes, personalities ........all the belts and whistles that smother the 1600 cc sedan segment in Malaysia. Car makers need to take cognizance of this matter as they are scrambling to push sales of models that are fuel stingy. Often, a little disregard on the customers needs might send the car makers into a tailspin. Let's take the Toyota Yaris in the US for example. The average price of Yaris is about US $14,000 which is about the same price as Proton Waja, but a tad higher than the Perodua Myvi, Chevrolet Aveos, Kia Rios and Hyundai Accents - cars that belong to the same category and sold in Malaysia. But can Yaris justify its premium prices against its counterparts one it arrives to Malaysia?

I sensed that Yaris in Malaysia might share similar attributes with Yaris worldwide due to the CBU (built up) model status in Malaysia. Toyota Malaysia may not find it practical to assemble the Yaris in such a miniscule amount. So, a fully imported version with airbags that could float you and in vehicle technologies that diminish your sense of touch with the road is in the cards. Let's hope that Yaris would be able to knock down the price of another premium subcompact in Malaysia - The Suzuki Swift (about RM 80,000 +++)

In the midst of Hari Raya Rush - wish there was a hybrid car

2005-11-06T19:22:00.000-08:00

The mad Raya rush is back again. And I am writing on behalf of those returnees from their respective hometowns up north upon spending their Raya the past three days. Those endless line of cars has created a massive traffic crawl along the highway!!

Can you imagine driving from Taiping to KL (about 200 KM) and took about 10 hours. Compare this to normal driving days which take about three hours. Here I am not talking about the grief and suffering inflicted by the stagnant car crowd towards the travellers (you have asked for it), but I am more interested in the damage done towards the environment which takes the brunt of the choking COs and the damage done towards one's car (idled engine increases wear and tear).

Is there any better way to save on wasted fuel and at the same time prevents premature engine wear? Maybe it is time for Hybrid cars in Malaysia or at least hybrid car rental companies in Malaysia. It is good for everyone - saves fuel, saves environment and saves money for maintenance. Cant do much to let you out of the traffic though, unless the hybrids can fly.

There are three eminent benefits of HYBRID: regenerative Braking, Electric Motor Drive/Assist and Automatic Start/Shutoff. But in our case here - Mad Post-Raya Rush, the auto start/shut off is the most applicable. The feature would automatically shuts off the engine when the vehicle comes to a stop and restarts it when the accelerator is pressed. This saves petrol and saves the environment by preventing wasted energy from idling. Engines would also be sparred from unnecessary idling which intensifies wear and tear.

But when can we have them? With the energy crisis threatening global resources, don't you think hybrid vehicles should gain as much of an attention as the bio diesel initiative propagated by the Ministry? Are prices limiting hybrid inroads into Malaysian market? Why is that the case? With the current revamp of AP system, high priced solution is no longer an excuse!!!!!

Is GM conceding the largest vehicle producer in the world title to Toyota?

2005-10-30T23:41:00.000-08:00

It is another chasing game with the eventual winner be bestowed the world’s largest vehicle producer. Who could that be? Well one thing for sure the number has been reduced to two - Toyota and GM. The battle between the two has been going around for quite some time but lately it has been receiving a whole lotta attention. If we consider the current auto scene whereby US suppliers are going out of business and US automakers are suffering from market share erosion, such thought provoking issue has merit.

Rumor has it. Toyota is likely to surpass GM’s production volume in the year 2006. Even the most pessimistic captains of the industry would acknowledge it – GM’s tenure is over. And according to a Japanese daily Toyota is planning to increase output by 11 percent next year to more than 9.2 million vehicles while GM is unlikely to top its 2005 forecast of 9.12 million. So GM is expected to relinquish the crown to Toyota. But is the market displacement going to hurt GM already battered by flagging sales in its own turf and escalating operational costs? Maybe not, it’s just a number. Let’s just hope that GM is not scurrying to beef up production to regain its position. It’s better to have less than to have a pile of unsold vehicles at its own backyard.

All in all, the dynamic race to the top benefits almost everyone. Good for the consumers and good for those nations whose countries become the breeding ground of these two giant behemoths.

National Automtive Policy - D Day for Proton?

2005-10-23T17:59:00.000-07:00

It appears everywhere likened to flowers after a morning shower. Roughly a day after the Malaysian National Automotive Policy was unveiled, advertisements and offers on various car models and names from about every make started to pour in leading dailies and medias. This is the opportune time to showcase their latest offerings that have remained elusive months before the policy was announced. Non national car makers have taken cognizance that chances to grab some market share from the national car makes, Proton and Perodua, have brightened with the new policy. Therefore, they sensed that their advertising dollars would be well worth in view of the current situation.

The good old days are gradually diminishing for the local car makers. The 50 percent discount for duties would be lifted leading to an even ground for competitors of the popular < 1600 cc passenger car in the Malaysian market. Such news are widely anticipated by the non nationals who have been increasing their investment in Malaysian auto scene. Other onlookers like Thailand and ASEAN automotive members also hail the move desribed as long over due. Now, the legislators could wait no longer. The protectionist regime must go as investors are shunning Malaysia as the hotbed for automotive investment. The threat is far greater than those prohibitive car prices decreed towards the Malaysian consumers.

Vietnam - 'My first GM Daewoo in my life'!!

2005-10-17T16:24:00.000-07:00

Too optimistic isn't it? A nation that is just beginning to embrace progressive economic development aspires to have each and everyone of its people to actually own and drive a car - a GM Daewoo preferably. Would not it be better off for people in the rural areas to begin with motorcycles first and later graduate to a sedan as their living condition improves?

Ahhh!!!! The realities of modernization - with sprawling infrastructures amid urbanization. As the upwardly mobile Vietnamese demands a better quality of life, more and more are shying from dilapidating public buses and common style mopeds. To jump into a car right away is unlikely, but to indulge in some fancy expensive type of scooters in the time of prosperity makes more sense for the newly rich.

Shifting Malaysian consumer trend......

2005-10-14T08:27:00.000-07:00

The rise in fuel prices has shifted Malaysian consumer’s preference. Loyalty to the large sedan, a mainstay of the Malaysian automotive vehicle market is gradually diminishing. OK we are not a nation of gas guzzling SUVs and pickup trucks. The number is just too trivial. But the country is home to a plethora of cars that can be thrift on gas and cheap on the wallet. Together these cars compete ferociously in a market dominated by national cars.

Are cars below the 1600 cc more appealing than their larger counterparts? Or do the consumers discreetly showing a penchant for those mini cars or mini MPVs like Perodua and Hyundai? As petrol prices do not show signs of abating, cars below 1600 cc have been getting much support from the government and consumers. The government with its reduced road tax program and the consumers with its insatiable lust to save on out of pocket expenses.

People have also become more cognizant of issues aurrounding the auto industry. They are buying cars now and they prefer those smaller hatches instead of the big ones. Consumers are not delaying car purchases in view of the National Automotive Policy, which is yet to be announced. They are not expecting sweeping changes that could pull down or clamp those ‘artificially high’ car prices. And surprisingly, these consumers are driving in droves to get those minicars and mini MPVs. Fresh new and bigger sedans do stir some interest but then again money saving prevails over power performance and ride comfort during these trying times…..

What really causes Delphi failure?

2005-10-10T16:22:00.000-07:00

The harsh impact of competition.

At times when suppliers are bracing for higher costs structure and auto makers pushing for further cost reduction, being an automotive parts supplier may not be too palatable. It is a matter of cease and decease with the latest victim being Delphi Corporation in the US. Being the largest auto supplier does not help either, as the small, big or large are vulnerable in the callous cycle of the automotive industry.

It is widely speculated and it happened. Delphi filed for bankrupty protection despite retaining its business operation in the US and key locations around the world. Which means Delphi in Malaysia would continue to supply Malaysian Proton with superb quality wire harness. But for how long?

What triggers all this? This is akin to the domino effect of global calamities like earthquake, tsunami and huricane. Automotive companies undergo revamp measures one after another. Well, for sure health-care, legacy costs, higher cost of materials all factors in Delphi's struggle. But what is the root cause? Is it the Asian or China phenomenon - the flood of meagerly priced but acceptable quality products into the world market?

The many faces of Honda Civic

2005-10-09T15:52:00.000-07:00

If you look very closely, these are all Honda Civic's faces disguised according to the regions they are marketed. All four carry the distinctive Honda emblem. The top left and top right are European and North American models respectively.

While the bottom two, which are quite familiar to us Aseans are those Japanese models - less luxury look but slightly meaner and more aggressive. This is a part of the Honda global vision - depicted through Honda Civic, a brand that is ubiquitious in every part of the world. A brand that is striving to please the needs and taste of every culture in the living planet by assimilating its car and blend it to the local taste and style.

But why those radical facials - up to four for a prominent car model? I am pretty sure Honda has done extensive research on this to come up with the multi faces Civic. Honda might have decided to heed the call of the global youth market - currently Honda Civic's largest target market. Listening and understanding those varying cultures with different likes, dislikes, styles, body preferences, musical preferences etc., Honda managed to create a Civic that is appealing to the world youth segment. But if you look closely at those designs, do you realize that those fascials really resemble the face of the people Honda is targeting at?

Is it still OK to remain independent?

2005-10-05T21:37:00.000-07:00

With all the ramblings about competition, declining market share and excess production, joining forces to create a bigger entity seems to be the rule of thumb in the auto industry. And this also explains why Proton is conceding its national iconic status to a giant vehicle manufacturer - VW, by parting a slice of Proton's stake.

However, amid uncertainty in the global automotive market ( petrol prices, hybrid vehicles, SUVs versus small car, Chinese imports etc.) one French car maker is still adamant towards mergers and acquisitions. PSA Peugeot Citroen is a good example on how being independent can still command huge rewards. Since 1998, sales have increased by 54 percent while its global car sales show no signs of abating. Its home grown creation the Citroen C3 Pluriel (above pic), is a head turner at the Paris Motor Show.

Not that PSA shuns completely foreign involvement in their automotive business. PSA has enetered into joint ventures with Toyota, to build a small car in the Czech Republic, with Fiat, to build people carriers and commercial vehicles in France and Italy, and with BMW to develop new engines. In other words, PSA values global alliance for better synergy and greater geographical horizon so as long as not to sacrifice its independent motor status.

But this happens to a car company that has already embraced the international auto scene, which Proton has yet to achieve. The global reach factor is so strong a push for Proton to succumb to foreign ownership stake.

Proton finally get the nod for increased VW stake

2005-10-04T17:12:00.000-07:00

The news came as expected. What else could Proton do in these trying times - declining sales and market share in a once protected market. VW's larger stake in Proton's manufacturing (hopefully) arm would boost efficiency, productivity and quality - elements long been adopted by rival giants and neglected by Proton. Unwanted suppliers are about to be discarded to pave the way for Proton's future plans in unchartered waters. Preserving the natural heritage whilst succumbing to foreign stake is a daunting challenge that needs to be confronted no matter what.

Not all foreign alliance failed. Just consider the Renault-Nissan alliance in 1999 and take a look at how Nissan's revenues have climbed from those days of steep losses. Unlike Proton, Nissan's cars are available worldwide yet they still stumbled. But in the case of Proton, this is what Proton is in dire need - access to global market. Therefore the possibility is there, Proton cars in market where Proton has yet or failed to penetrate. Who knows Proton cars may be used to beef up VW presence in China which is under assault from all names all makes of vehicles.

Is this an opportune time for Perodua Malaysia?

2005-09-28T17:32:00.000-07:00

The minicar revolution has just started in the US. The influx of this new badge of cars often referred to as minibox cars is projected to emerge as a new growth segment in the US. It is quite fascinating how the largest vehicle market is slow to embrace this trend which has already captured a legion of followers in Asian countries like Malaysia. Maybe the Americans failed to realize the benefits of this mini warrior as they never stop to hate those giant gas guzzlers like the SUVs, V8s and pickup trucks.

The mini MPVs , minicars or a bunch of vehicle crossover names do warrant some serious attention in times of changing market and consumer trends. Consider in Malaysia for example the growth of perennial mini MPV favourites like Hyundai Atos , Perodua Kenari and Perodua Myvi. Those wagon like vehicles which zip through traffic like a speed demon is taking the market by storm in Malaysia.

Their functionality and versatility appeals to many as these vehicles cater to shifting lifestyle and varying user applications. These cars adapt well to owners who has moved from the echelon of active singlehood to married status with kids. This car can fit them all. In addition, owners of the mini MPV would not have a hard time hauling up goods if they plan to engage in some sort of business activities. Forget the pickup truck ! those goods are gonna get soaking wet in Malaysian rain. These benefits of practicality and versatility are a courtesy of the cavernous interior spacein mini MPVs despite their small exterior dimensions . And they come with an attractive price too. (about $USD 10,000)

So with all these hypes thrown at local car makers to explore other greener pastures, why not consider the US minicar segment. We would not be touting our 4 door sedans - that is tantamount to suicide!!! Perodua can spearhead this initiative and who knows the goal to become the center of small car production in Asia would be achieved if they managed to penetrate the US market preferably under the Daihatsu brand. With the foreign brands gaining ground in the US, another Japanese nameplate like Daihatsu/Perodua might have the upper hand. So move on Dodge Neons!

Grassroots invention - Can the auto industry get back to basics?

2005-09-26T16:32:00.000-07:00

Some of the inventions shortlisted for an award in Singapore this week are very impressive indeed as they are touting simple and practical design in a society beset with modernization.
Amphibious bicycle that has floats which allow it to run on water, natural airing ventilator that requires no wind and consumes no power, machine that digs for groundnuts and separates them from the soil and modified pulley for wells which has a locking mechanism to stop the rope from slipping into wells. Surprisingly, many of these practical innovations come from ordinary people with limited schooling.

What struck my mind was how simple such inventions are yet the impact they created to the society is tremendous particularly those poor people who have no access to modern technology. Can the automotive industry replicate the same thing? Coming up with practival, cheap, simple yet useable technology that could make ultramodern cars more affordable to people living in the 3rd world nations. This would definitely promote motorization and thus enhance their standard of living.

Is there any chance that cars can be improved upon other than hoarding them with electronic gizmos that leave vehicle reliability in question. How about a truncated version of the mini electric fan in car to replace the air conditioning system that sucks up petrol? It is good for the environment and best of all it makes car ownership affordable.

To become the world's top 10, Thailand really need the Japanese......

2005-09-25T16:41:00.000-07:00

Thailand has set a goal of producing 1.8 million vehicles by 2010 and become one of the world's top 10 automotive manufacturers. A manageable ambition indeed considering that Thailand is the largest automotive manufacturer in Southeast Asia sitting at number 15 in the global scale with more than 900,000 vehicles produced in 2004.

How can Thailand prepare itself to achieve such a magnificient feat? One way is through concerted effort from the Japanese, a fervent supporter of the auto industry and a very well entrenched player in Thailand automotive market. The Japanese have been instrumental in spearheading the development of automotive industry and one area of interest is skill building among the Thai workforce.

Program to churn out skilled workforce, a collaboration of Thailand Automotive Institute (TAI) and the Japan External Trade Organisation (Jetro) has finally taken shape in a bigger scale. It plans to produce about 10,000 engineers and technicians every year through curriculum overhaul in schools across Thailand. These graduates are expected to fill up the burgeoning demand for skilled staffs at Japanese plants which are scattered across Thailand. With an adequate and cost effective labor pool, production of automotive vehicles is less likely to be transferred to the mighty China too. This can be construed as a welcomed relief to Thailand's aspiration to become an automotive powerhouse by 2010.

Hybrids versus diesel in Europe

2005-09-23T03:16:00.000-07:00

The Europeans seem quite cynical on the prospect of hybrid cars. Their penchant for diesel vehicles as a thrifty mode of transportation is unrivalled by any other forms. But when hybrid vehicles were swarmed by onlookers in the recent auto show, many pundits finally took note. They realized that the early hybrid developers, Toyota and Honda, may be right in pursuing the environmental fronts. Hybrid cars, which combine an electric motor with a regular gasoline engine can cut fuel consumption by as much as 25 percent.

Now, even the Bimmers, Benzes and Porsches have begun developing their own hybrids as sky high petrol prices hasten the development of alternative vehicles. Diesels are likely to take a back seat in the future as the German car makers no longer dismiss hybrid technology as costly and inefficient. With the dizzying pace of hybrid development, the German makers could not afford to sleep through the hybrid development. They need to wake up fast to catch up on things started by the Japanese a while back.

The threat of demise of the Australian auto assembly........

2005-09-21T16:32:00.000-07:00

The cost cutting agenda in the wake of globalization does not spare anyone - even industrialised nation like Australia. For a relatively long period, the automotive industry in Australia is heralded as one of the prime movers of Australian economy. But as organizations move forward into an era where cost cuts are being championed, industry players that failed to compete on the basis of pricing would eventually perish.

Such fine example is the the automotive assembly industry where the threat of demise is looming. In Australia, it is becoming impractical or not economically viable to engage in vehicle assembly as a result of higher cost structure. Australians feel that it is more appropriate to merely become importers of cars from countries that could make them cheaper than Australians. This scenario is exactly what happened to the Philippine automotive industry.

This changing landscape was augmented by the government’s policy of reducing trade barriers, which was putting domestic manufacturing under a lot of pressure. Many realized that assembly and manufacturing have to make way for the full imports. For instance, Holden in Australia is expected to streamline its production efficiency by trimming about 1400 jobs, revising its production forecast and transfering its supply base to cost effective GM subsidiaries.

While the benefit to the customers is imminent in term of lower prices, this shifting practice is likely to adversely impact the Australian parts suppliers who had to forgo their businesses to cheaper counterparts in Thailand and China. If only the global giants can continue to drive efficiencies, then car assembly in developed countries like Australia could continue - which is less likely in the foreseeable future.

Singapore car prices on the verge of decline?

2005-09-21T02:29:00.000-07:00

Singaporeans they say, can afford it all - nice cars, condos etc. And surprisingly, the government is putting a cap on purchases of certain big ticket items like cars. It has to be done to prevent every one from splurging on cars and choke the mini streets of Singapore.

The government introduces the Certificates of Entitlement (COEs), which is a form of registration fee that double the cost of the car. Coupled with hefty import duties and expensive car licences, you have normal sedan car prices the equivalent of Mercedes Benz or BMW prices in Malaysia.

However, things are about to change. Car prices in Singapore, though still among the world's highest, are expected to fall in 2005 as the government plans to allow more cars on the road to boost consumer spending. There is this perception that once prices tumbled, the economy would receive a sudden jolt. New vehicle registration is expected to increase almost 20 percent in 2005 as Singaporeans rush in to get the cars they longing for over the years. But how long can the city remain gridlock free due to the burgeoning car population remains a big question mark.

A stupendous pickup truck in Thailand .................

2005-09-19T17:25:00.000-07:00

Battle rages in the heated pickup truck market in Thailand. Isuzu is ferociously protecting its leadership in this segment as its closest rival, Toyota, has been relentlessly pursuing the top spot with luscious new truck models in 2005. In the latest standing, Isuzu has about 37 percent share of the market while Toyota commands about 35 percent in a segment that never fails to register double digit growth in the past 5 years. Isuzu is clinging desperately onto this position it held over the years amid stiffer competition from rivals who are aggressive on new launches as well.

The latest and most prominent threat is Mitsubishi. Mitsubishi is revamping its Strada pick up with a highly regarded futuristic-look truck called Mitsubishi Triton. Of all new pick up trucks released by counterparts like Ford, Nissan, Chevrolet and Mazda, Mitsubishi's latest attraction is most striking. It has caused a stir in the market segment and invoked a mixed reaction among Thai consumers who are contemplating on getting a new pickup truck. Toyota and Isuzu models are usually on top of their list while Mitsubishi name plate rarely crosses their minds. Except that this time around, their decision might be overturned in favor of the Triton.

Elsewhere in Malaysia, we have also witnessed Mitsubishi cars gaining presence amomg the diehard Proton fans in the wake of rescinding ties with Proton. This time it is Mitsubishi which is expected to play a major role in Mitsubishi Motors Revitalization Plan as part of its revitalized global market strategy. Proton is out of the picture......

Forget China - India is the new hot bed for automotive

2005-09-18T18:45:00.000-07:00

These days, China remains a hot topic within the automotive enclave. Almost every big name would get snubbed if they haven't land their foot on the promised land. Together, these automotive giants contribute to the stellar growth of the Chinese automotive industry spawning birth of large scale component players and home grown automotive manufacturers. But did the industry ever stop and ponder that there is life other than China? Has anyone come across India - the second fastest growing economy in Asia after China?

With that itself the whole automotive community has something to cheer about. A self sustaining automotive industry that is like to enjoy continued growth in the ensuing years. A new place to plunge the multi million dollar investment other than China, which is taking steep measures to contain its heated economy and its auto industry's meteoric rise.

India has emerged as the fastest growing car market in the world with sales growth of almost 24% in 2004 surpassing China's almost 14% growth in year 2004. India still lags other Asian giants like China, South Korea and Japan in terms of automotive sales. But as India's growth surge is relatively new ( since 2000) and the stagnant automotive market of the Asian behemoths, India has much bigger room for growth, a whole lot to offer and much more excitement!!!!

Toyota's sweet thing - the IMV project !

2005-09-15T20:54:00.000-07:00

Toyota's innovative IMV program dubbed the (Innovative International Multi-purpose Vehicle) project is a hallmark of success. The IMV project is the production of Toyota models that really meet the needs of consumers in particular region in terms of practicality, fuel efficiency and local condition suitability.

Toyota has designated three models in ASEAN, with production lines scattered among the countries: Hilux Vigo in Thailand, Kijang Innova in Indonesia and Fortuner SUV in Thailand. Toyota's IMV lines have also expanded to Toyota plants in South Africa and Latin America. In ASEAN, the IMV thing is a big hit in Thailand, which is also Toyota's biggest base in South east Asia.

Toyota Motor Thailand has its sweet taste of success upon first year of IMV program implementation, with domestic and export sales of nearly 220,000 units. The success has propelled Thailand into the second biggest pickup truck manufacturing bases in the world after the US. The best part is that this program uses about 90 to 96 percent ASEAN content. Read it ASEAN!!!!! Which means there is a ray of hope for those discouraged Proton and Perodua vendors in Malaysia to jump into the band wagon. This can be construed as a platform to tackle the outside market - Toyota plants globally. Diversity should be the prime driving force in the current automotive quagmire.

China's Geely world dominance?

2005-09-14T23:12:00.000-07:00

Have you come across the name Geely? If you glance through my earlier posts you would recognize an article on Malcolm Bricklin's grandiose ambition to make Geely a big name in the USA. Well, that is part of Geely's American aspiration. That is part of the story. Listen to the latest snippet......

" ....Geely, the mainland parent of Hong Kong-listed Geely Automobile Co Ltd, has forecast a 20-fold increase in annual output by 2015, with two-thirds to be sold on the international market. The group, owned by Li Shufu, who is listed by Forbes as one of China's richest men, said it aims to boost output to 2 million cars a year by 2015, up from 100,000 units last year". To sum it up, they are preparing for an onslaught of the global automotive market. A very optimistic ambition, considering the almost saturated car market in several parts of the world.

Their latest model line up for the Frankfurt Auto Show showed some seriousness on their part. Their latest car models unveiled at the show do not resemble any other models you have seen before in any market. There might be look alikes on the body lines, headlamps - but nothing as obvious as flagrant imitation. Geely is bending backwards to convince people that Geely is not a copy cat car maker.

Geely has plans to assemble its car model 'Freedom Cruiser' in Malaysia this coming December. With current market trend gravitating towards non national vehicles, Geely needs to tout other areas than pricing alone to lure the discerning Malaysians. Geely has to lift its reputation, quality and safety level at least to Malaysian standards. Who knows, Geely would become a formidable competitor in the Malaysian auto scene and Malaysia becomes a launchpad to swarm its car models to other ASEAN market? Hmmmm, maybe its 2 million car target by 2015 isn't full of balooney !!

Hertz for sale - Any Asian takers?

2005-09-13T03:24:00.000-07:00

Some news this morning. Hertz which is owned by Ford is up for grabs. Not too worry, the market has already discounted this news from all past rumors lingered in the automotive space. Ford is dead serious in turning the company around. First, the promotion of Mark Fields and this time the sale of Hertz. Whats next ? Anything to do with the recent massive recall would be of great help. Still too early to extrapolate things.

I can recall those college days in the US, where I tend to choose Hertz for my car rental needs. During that time, Ford Contour was my car of choice. It is solid as hell. Too bad they they discontinued this model. As a rental car, this Ford Contour is subjected to my abuse. Hey I could not afford one, might as well thrash it. Amazingly, this car prevail. But at least I am decent enough not to top up the petrol with some other liquid to comply with the full mark on the fuel gauge upon returning the car. The best thing was that the Hertz sales manager managed to keep its smile despite seeing its Contour coming back with slimy grime and mud.

OK that is history.

Since Asian car makers like Chinese and Koreans have a lofty ambition to conquer the global auto market, let the sale of Hert become a part of the agenda. This might be construed as one way the Chinese makers could penetrate the auto retailing in the US after a botched attempt to takeover Unocal (if I am not mistaken) in the US. Bah, thats oil and gas - a different story.

Personally, I don't think there are any other Asian industrialists are as hungry as the Chinese. Look at Lenovo and Haier - they have already reached stardom. Since Chinese could not push its shoddy built cars at least it can redirect its focus towards car services - Hertz Car Rental perhaps.

Smart For Four - too much attention?

2005-09-11T16:04:00.000-07:00

In the nascent stage, the Smart brand was thought as a brand failure to Daimler Chrysler. Why would an established car maker would want to join forces with a watch company (Swatch) to launch a concept car. Does Daimler Chrysler aspires to become an international icon comprising of formidable names from every part of the globe?

To those naysayers, Smart has already launched an array of cool looking cars including the latest four door Smart, which is expected to hit the Malaysian roads soon. Ha, finally the Smart people is getting smarter. Small four door compact cars are those that sell well in the market rather than two door compact. Even the smallest car in Malaysia, the Kancil comes with four doors. That explains why the public kinda disregard the two door Smarts earlier. Smart also comes with interchangeable panel set, which is a bizarre option for a car. But in a country where drivers are rewarded with dings and dents for driving in the city, such an option might eliminate body knocking and panel beating completely. Just pick and choose the replacement panel and Voila! - the first multi colored car on Malaysian roads.

Anyway, the Malaysian motoring public roars with enthusiasm approving this 4 door pocket rocket. With a price of RM 116,000, the Smart is likely to give the Koreans and Japanese brands a run for their money.

Honda's first motorcycle airbag

2005-09-08T20:47:00.000-07:00

Is it necessary or is it practical, an airbag designated for motorcycle use? It is finally here, a motorcycle airbag developed by Honda making a debut in the US sometime in 2006. Too bad, it was developed only for Honda's flagship Goldwing, a luxury motorcycle.

What about the rest of motorcycles in Honda stable like the cheap 'bebeks' 'underbone' and 'kapcais' in the ASEAN market whose riders are clamouring for extra safety features? (Honda bikes are dominant in the ASEAN market) Riders of two wheelers need some form of justice in this part of the world where their rate of extinction due to accidents surpasses climbs steadily each day. I understand it comes with a price but with two wheeler volume in the millions to feed the transportation needs of many ASEANs, motorcycle airbag fitment is deemed practical.

If the makers come to terms on airbag deployment on the cheap bikes, they should also consider airbag for the rear section. Riders are hit not only from the front but also from behind. Airbags geared for rear impact might alleviate injuries to the back while the front airbags should be able to prevent riders from turning into a superman upon impact. Better still, the makers should consider front and rear airbags that defuse simultaneously upon impact in either front or rear. It might prevent more sorrows or even make motorcycle a better option to cars.

Another massive auto investment in Malaysia

2005-09-07T16:41:00.000-07:00

Another new investment in the automotive industry in Malaysia? What caught me off guard was it actually comes from a local car company. What? With all the negativities surrounding the domestic car makers like heightening competition,AP etc, they have the guts to pour more money into the industry?

A hefty RM1.2 bil (USD 300 million). That's the amount Naza plans to inject in a large scale assembly facility in Penang Island, Malaysia. Again, why Penang? Logistics reasons? Why not near the current Naza plant in Gurun? Isn 't the network of vendors has been established there?Naza assembles and distributes Kia vehicles in Malaysia. And the good part about the Naza Kia relationships is that Naza is a licensee of Kia and fully owns its manufacturing plant.

That means Naza is not confined to producing Kia vehicles only in Malaysia. Naza is more flexible and can even become a contract assembler for Proton if he wants. Such a wise move but comes with a price. One needs to have deep pockets to engage in such a venture which is not a problem for Naza who has built a gigantic treasure chest dealing with imported cars in the heydays. Naza managed to convince another auto maker fto assemble their car line up in the future Naza plant - Peugeot of France.

Naza is harnessing its assembly skills to roll out Peugeot 206 sometime early 2007. Guess what, the Peugeot is going to be named Naza 206. Another national icon? Doesn't matter much to me as long as the local content requirement of the 'national car' is met accordingly - no slipshods. That will help to kickstart the ancillary industries who are too dependent on Proton.

To conlude, vehicle makers who want their vehicles assembled in Naza plants must have Naza nameplates, prefixes and be called Naza blablabla. Is there going to be Naza Waja or Naza Gen 2 or Naza Savvy in the not too distant ?

Proton and Kleemann - a marriage made in Heaven?

2005-09-06T16:54:00.000-07:00

Whats up with Proton nowadays?Running out of creative juices to churn out alluring new models? Or being pressured to go after something daring to revive sales? Maybe teaming up with an established tuner (Kleemann) to deliver a souped up Proton would stoke interest from the motoring public. After all, how many new models can Proton launch in a particular year to compete with the imports? With regards to Kleemann relationhips - Proton need to do it right this time as it failed to bring cheers to the industry from its previous international collaboration - MV Agusta, Lotus, VW. To say that this tie up would be a success is still too early to tell.

The question to Proton is which models would be infused with the Kleemann DNA? Proton's money making outdated models like Iswara and Wira ot the new versions of Gen 2 and Waja? My thinking is that Proton should consider the latest offerings (Gen 2,Waja,SRM) if upgrading to a Kleemann system is an option. As we can see imports like Honda and Toyota which are costing RM 20,000 extra are selling very well in the market, undermining Proton's market share. Well, maybe their chief reason for opting for the imports is that they are tired off the national cars. Other solemn reasons might be quality aspects and technology offering at an affordable price.

In order to target this segment of buyers, why not providing more options for Proton's new model range? Other than the options of metallic and non-metallic......Proton can offer top notch Proton equipped with Kleemann system for the discerning import customers. If these people can afford the RM 20,000 extra on similarly equipped imports they might be able to spend at least an extra RM 15, 000 on Proton's improved and beefed up model versions. Who would not want a Proton which comes with a Mercedes Benz inspired tuning system.

This value added strategy has been implemented previously but not to this scale, where a major renowned engine tuner is involved. This is one initiative Proton has undertaken after enduring a lot of pressure in the recent past to forge more technical JVs with a foreign company......

Honda is investing more in Pakistan - what about the rest?

2005-09-05T16:26:00.000-07:00

Honda Atlas Cars (Pakistan) Ltd. (HACPL), Honda’s automobile production and sales joint venture in Pakistan has plans to double the capacity of Honda cars in Pakistan. HACPL will increase production capacity by expanding plant facilities and upgrading welding and painting equipment. Hence, annual production capacity will be doubled from the current 25,000 units to 50,000 units by the end of 2006. Sales of automotive vehicles in Pakistan reached 133,000 units in 2004 – more than double the market size three years ago in 2001.

Honda is joining Pakistan's growth bandwagon as well as contributing to the economy and society of Pakistan. As Honda pours in more money, one can just concurs that Honda has done its homework, and not haphazardly putting funds into murky business opportunities or high risk territory - a sort of war zone. Maybe Malaysia's Proton should take note in its frantic search for a new avenue for its cars which took a nosedive in the domestic market. Even though Pakistan is a 100,000 cars per year market, it is a market brimmed with potential due to its burgeoning population which is moving up the prosperity ladder. Honda seems to realize this to become the early bird that seize a larger chunk of the market. Like the old saying goes: “Victory goes to the firstest with the mostest.”

Asian car makers triumphed in the US market

2005-09-04T19:41:00.000-07:00

We have heard it again and again. American made vehicles are at the mercy of their foreign counterparts: the Japanese and the Koreans are gaining, capturing the market share of the US giants. Why do they thrive as Americans suffer? Is Quality the main concern or prices? I think more appealing models by the imports justified this scenario........... Lets look at those startling numbers.....

Despite efforts championed by GM like staff discounts which propelled sales of GM cars in the US, the Japanese makers thrived mostly without such incentives. Honda Motor Co. led U.S. auto-sales gains with a 23 percent increase in August, helping Asian carmakers capture record market share after being eclipsed in July by discounts at General Motors Corp. and Ford Motor Co. Japanese and South Korean automakers sold 578,277 cars and light trucks last month, a 15 percent increase from a year earlier. The gains included 14 percent at Toyota Motor Corp., Asia's biggest carmaker, 15 percent at Nissan Motor Co. and 9.3 percent at Hyundai Motor Co. Asian companies' combined share rose to 39 percent from 35.2 percent.

But credits should be given to GM for its successful employee pricing program. It is actually a wake up call to Asian car makers that some form of incentives can be beneficial. Honda heed the call. Honda has been quite aggressive in promotions to date with lease offers unheard of for Honda's popular Civics and Accords. If others follow suit, then there is really going to be a price war in the US!

Ford Focus is invading Asia.......from the Philippines

2005-09-01T16:39:00.000-07:00

Heard the latest automotive buzz? Yes, the legendary Ford Focus is returning to the Malaysian, Indonesian, Philippine and Thailand market with a fiercer look and more dressed up features. Best of all, this Ford's pet model comes in a sedan - slightly extended than its predecessor the Focus hatchback. Perhaps, Ford finally took note that this type of car sells well in this part of the world.

Surprisingly, at times of economic slowdown coupled with escalating fuel prices, this luscious Ford model receives favorable response in ASEAN - Indonesia, Malaysia and Thailand. Well, one thing for sure is its affordability. Ford Focus is being assembled and exported out of Philippines - one of ASEAN members who embraces AFTA free trade. In Malaysia, the price is expected to be around RM 130,000, slightly higher than in Thailand which is around RM 100,000 (in Ringgit terms). You can blame all those blocks of tariffs imposed on imported cars.

I couldn't believe Ford has turned Philippines into a world class Ford assembly facility despite the lacklustre automotive market in the country. To date, Ford assembles and exports the Escape, Lynx, Focus and Mazdas from the Philippines. This clearly indicates that Philippines supporting industry comprising of auto parts makers are world class vendors capable of supplying parts acceptable to global standards. This is quite perplexing in a country where low volume of vehicle production is not doing justice towards economies of scale and efficiency. In reality, Ford has done it in Philippines. Ford works closely with 61 local vendors producing an estimated 1500 parts. That is a commendable figure - considering that only a handful of Philipine parts companies are export driven.

Maybe the next time around I will pop up the hood of a Focus and try to pinpoint parts that are of Philippine origin.

Vietnam is to have its own Proton (national car)?

2005-08-31T16:40:00.000-07:00

Check this out!

Vietnam is expected to roll out its own national car soon - a sort of Malaysia's Proton. Is it practical, for a country that sells less than 30,000 four wheel vehicles per year? Philippines is a country that sells less than 100,000 units of vehicles until it finally discovered that car assembling is an expensive option. Direct importing is the better option as at such level of production, local manufacturing or assembly does not make economic sense.

Vietnam is seeking the tech prowess of Hyundai, similar to Proton who turned to Mitsubishi in the earlier days for its much needed technology support. What is the main reason for the decision? Maybe car prices are beyond the reach of average consumer or the government wants to boost the ancillary industries? (Car prices are about 2 times higher than other countries in the ASEAN circle)

How about the prices ?Are those national cars going to receive preferential treatment like Proton has before? What would other assemblers like Toyota, Honda who have set up assembly plants say in the near future? Is it going to jeopardize Vietnam's AFTA commitment ?

Too many questions receive unconvincing answers. Personally, I believe inefficiency would result if not now but in the not so distant future. At this pace of globalization, I strongly think the Vietnam government should follow the Thai's footstep. Let the Pros make the cars and the locals support the giants by making the car parts. After all, Honda in Vietnam has made the pledge to produce affordable Honda Civics for the Vietnam market. Isn't that sufficient?

Moreover, the government is urging the assemblers to increase the local content in vehicle production to help the local parts makers and to bring down the car prices. To reiterate, isn't that sufficient? One thing for sure is that such grandiose ambition requires a total revamp of Vietnam's obnoxious and inconsistent automotive duty structure. Other than that, the government has to ensure that such investment would not jeopardize the public's coffers. Else, the national car project would suffer the same fate as the defunct Timor car, a project with Kia Motors in Indonesia.

A good remark about Savvy finally?

2005-08-29T19:06:00.000-07:00

All these days I have heard only good news about Perodua Myvvi. Yes, I have seen and been in the car long before it was released to the public. Despite being a trial model, I was impressed by the built quality in the pre-production stage. Then, Proton Savvy was launched. Too bad for Proton as Savvy has to compete in an atmosphere brimmed with Myvvi's enthusiasm.

Not a single enthralling piece on Savvy. I could hear rants and raves about its built quality with no positive tones enjoyed by its counterpart Myvvi. But wait a minute. Did the remarks come from someone who actually owned and drove the car? I am interested in finding and talking to someone who has the Savvy experience. Where huh?

I was lucky that I need not go very far - my own colleague. The best part he has also been in the Myvvi. Now for the comparison. Savvy tops in terms of handling and engine performance - attributes geared for drivers fascinated with satisfying themselves predominantly. It however fails to satisfy those cargo or people carrier - but does Savvy cares? If one is into peolple mover, then Myvvi is the clearer choice. But driver oriented person might just curse his way through in a Myvvi, as it feels lie riding a truck due to its big but fishtailing at times.

So the verdict is out. Driver preference towards the Savvy due its driver centric characteristics and practicality goes to the Myvi due its multi versatility. Maybe it is a one man viewpoint, but at least some it helps to diminish the ill conceived notions about the Savvy.

Cant live without it - The Indonesian motorcycle market

2005-08-28T20:45:00.000-07:00

One thing for sure, Indonesia is a motorcycle country. Thousands of them blazing past you in the notorious city traffic. They are indeed quick or practical I suppose. I was riding in one of them after I reached the wrong destination for an appointment by taxi . I have no choice, I have five minutes to spare. Without a helmet, I was praying hard as a pillion rider as the bike was gliding centimeters away from huge truck lorries during frequent wild turns. On top of that, impatient Kijang owners and other motorcycles tend to appear by my side from every nook and cranny.

The Indonesian motorcycle industry is amazing - totaled about 4 million sales in 2004. In 2005 this year, sales do not show signs of abating. Growth this year is expected to be slower than last year, but still in the double digit territory - 20 percent from consensus. This is despite concerns of rising inflation, depreciating Ruppiah, interest rates hike and diminishing confidence. I believe these factors are a boon to the motorcycle market from an automotive industry perspective. Would be owners who are divided between buying a car or a bike may likely opt for motorcycles for their transportation needs.

The main concern is the bulk of the population which is living in a less desireable condition. Their decision to buy motorcycles might be postponed. But with prices of key products and goods rising at a dizzying pace, they might find no other alternatives but to work harder to make ends meet. And this sometimes entail a good and cheap form of transportation to fork out a living.

Indonesia's unique aftermarket industry

2005-08-23T07:06:00.000-07:00

OK, I have missed out several days on this blog. I am in Indonesia now for a fact finding mission/corporate espionage/competitor snooping...aah you can name anything to label your amiable Research analyst. Other than those gorgeous Indonesian girls, I was caught off guard by the large number of street repair shops catering to the two wheeler and four wheel vehicle owners alike. Dozens of makeshift garages from tire replacement to alternator rebuilding are sprawling all over Jakarta. However, I have yet to come across a 10 minute oil change by the street - maybe I should start one.

I am not going to cover all of them here. Let me first touch upon the car seat upholsterers or seat makers whom are present along the streets of downtown Jakarta, Jalan Kebun Sireh if I am not mistaken. Here, you could find merchants selling top names like like Recaro seats along side their dilapidated sewing machine. I guess you can call it 'built to order ' in automotive terms. I didn't bother to check on their prices though....but I am pretty sure the prices are negotiable in spite of being outrageously low from and American or European pricing standpoint. Besides those new seat, (they look pretty decent from a distance), these street tailors or seat repairers are also selling second hand seats out of traded ins. And they didn't look too bad either.

Perhaps, Brothers in Malaysia (the largest accessory shop chain in Malaysia) should consider sourcing their seats from these merchants. But first, take off the Recaro names so as not to offend REcaro Malaysia!!! Or worse, faced with a law suit!!!!

Wow the new Hyundai has arrived?

2005-08-18T16:31:00.000-07:00

Sleek and tantalizing? Thats the new Hyundai launched in the Middle East, an interesting piece of story received from a prominent Middle east automotive website this morning. I wonder when can we view them on Malaysian roads. A closer inspection gives me the impression of a late model Honda Accord - with its short hunchy tail and prominent front lamps. I am not sure if the front fascia resembles the Accord or any other car models. Judging from the side lamps it looks like other popular Honda models too.

Isn't Hyundai contend withe the present models which I believe have received overwhelming support? has globalization forced car makers to release new models more frequently, an annual event perhaps? I guess Hyundai is taking advantage of its high demand for cars to churn out more crowd pleasers to the public. So it is better to sell them while the name is hot. For if the name brand is tarnished due to poor customer feedback as experienced by Hyundai in the early years in the US, further new model launches can just remain a dream. Hyundai did learn its lesson and has so far graduated with flying colors.

Rain and accidents

2005-08-17T19:45:00.000-07:00

As promised, I would write at least a piece on the auto industry. This one is about personal experience when I was driving in the rain this morning. A small accident occured at a curve infamous to impatient motorists. Damage starts when one goes by too fast during this rainy and wet weather.

I am glad it was a minor one. I am not too fond of witnessing those accidents with bodies lying around amid gore and blood. The car involved was a fairly new Volvo - an 850 I guess. And since it was a Volvo, damage to the car was at a minimum, with only the front end was crumplped. The owner was checking at the damage with the aid of a passerby - which is I am sure a callman from a towing company. I wasn't too sure about the railing that was hit. I am sure it was dented as well as I was negotiationg bits and pieces of road tar on the other side of the road.

I imagine similar thing occur to me and my Proton. With its soft metal and flying dashboard, ,I might be left shocked and nervous stricken or worse of all knocked out. I hit a road divider once but that was due to my misinterpretation of a parking space. The front bumper was misaligned as a result. I started thinking at the time what if it was a major accident? Based on what I saw this morning, I will be driving my Iswara slowly in the rain for quite some time.

Its been a while now .........

2005-08-16T16:40:00.000-07:00

Work commitments, travel assignments are excuses for not engaging in daily writing. Yes I do write a lot but for not for this blog which I have been putting off for quite some time. Now I have a commitment (hope to keep it long) - a fresh one to contribute insights on the auto industry in the daily basis.

Blog writing has its benefits. Besides keeping me on the toes on the latest grumblings on the automotive industry, this activity helps to polish up my writing skills to prepare myself for bigger writing projects. Afterall, once writing becomes second nature to regular dosage, the 'writer's block phenomenon is less likely to happen. Remember the old adage ' Practice makes Perfect'

There are a myriad of stories in the Malaysian automotive these days. But after a long hiatus, let me start with some personal stuff - of course it is related to the auto industry. This one concerns my car payment. It seems like I have been paying them (the finance companies ) for ages for my aging Iswara. When I got hold of the recent statement, I was quite dissappointed. I have got two more years to go.

Gosh, it makes me feel like living in a penitentiary, two more years before I am released from shackles of car finance. I just cant wait for the day when I have the extra cash. Too many things in mind with that miniscule amount. I might spend it for my kids welfare or worse I might spend on repairing the aging or 'paid off'Iswara.

Proton and VW venture - the deal of the decade ????

2005-04-10T16:26:00.000-07:00

Maybe its not as hot as the MG Rover and SAIC talks. But here in ASEAN region, that is the talk of the motor industry. Everyone here keeps a keen eye on Proton's latest maneuver most notably the Malaysian government and the shareholders. They want a turnaround. And this is the least Proton can offer - international JV that is frequently lambasted by competitors and critics alike - in Malaysia and in ASEAN countries. The question is - Is it going to work - the mating of two automakers with different goals and objectives?

Proton has seen declining market shares at its home turf Malaysia. While Proton is frantically searching for outside market, ASEAN members particularly Thailand is not receptive to Proton's grandiose ambition. All those protectionist measures and market manipulation hamper Thailand's effort to boost its image as a global car center that appeases international investors. Thailand considers this retribution time.

The deal with VW is an icing on the cake for Proton to expand its market coverage that includes the large ASEAN market albeit as a VW brand.The Thais and Indonesians might be more interested in having a global nameplate in their vehicle market. Besides having recognized quality, global names are cherished for their openness towards the home market. Host countries understand the opportunities it brings to the supply chain and service sectors without the common restrictions associated with national champions like Proton.

In fact this is a welcomed effort for Proton to actually focus on its achilles heel -poor acceptance in external market. VW definitely can teach Proton the tips and tricks of car making - but what Proton really needs is the skill to permeate the world market in a big way - first ASEAN then the rest.

More surprises to come - Car prices creeping up!!

2005-04-06T18:54:00.000-07:00

So its not just the AFTA chronicle that is responsible for high car prices in Malaysia. Steel is another culprit. Blame China for such price spike or perhaps the local parts manufacturers whom are not efficient.

That is Malaysia. First the spiralling cost of petrol and now the escalating cost of steel. As always, the cost is passed on to the consumers - that is inevitable. Consumers might be able to accommodate a slight increase, but on a frequent basis? That would really put them and the auto industry in a treacherous mode. Sooner or later, we might all see Malaysians riding two wheelers on the road or pedalling bicycles to work. Well, that is too far fetched.

Well on the automakers side, they are also feeling the pinch.There is just not enough margin to vindicate the already 60% increase in steel prices from 2004. More price hikes in the pipeline in 2005 due to rising worldwide demand. Increased steel demand escalated by China’s insatiable appetite for new construction and rising material costs means the global auto industry including Malaysia's either has to slow production or buy steel from alternate sources. That's good news to Malaysian AFTA task force - they no longer shouldering the blame for price increase in Malaysia.

A hope for Gen 2 in the Australia market

2005-04-05T09:36:00.000-07:00

Is Australia another success story for Gen 2 or just another flip flop ? Lately some issues in OZ automotive market is bringing cheers to the Proton community in Australia. Is it true? Isn't the auto market beset with tons of makes and models eyeing for the slice of the big Australian pie? Proton's Gen 2 competes in the Australian light car segment with notable competitors like Hyundai, Kia and Suzuki. Isn't it tantamount to suicide to battle against these established names ?

Maybe. The reason why there is hope for Gen 2 to enhance its market penetration is the fact that a number of automotive names are pulling out of the OZ market. Daihatsu withdrew from this segment last week leaving a gap of about 10,000 car units to be filled by the remaining competitors.GM Daewoo had earlier deserted the OZ market in December 2004.The reason is plain simple - too many models - around 23, are chasing for consumers in a limited market.

So in reality, Gen 2 is not doing any better except the fact that it has more space to grow now due to departure of Daihatsu and Daewoo.Should Gen 2 capitalize on this and move forward with its OZ plans or throw in the towel just like the rest?

Proton is struggling in the OZ market. Last year in 2004, Proton's sales could not even surpass the 1 percent market share in overall vehicle sales. Worse, Proton managed to sell only 170 Gen 2 cars so far in 2005. Maybe Proton should take note on the current happenings. Daihatsu and Daewoo might be telling us something we did not know - Get Out before its too late.

Singapore fuel price wars?

2005-04-04T13:23:00.000-07:00

".....REFLECTING fierce competition, ExxonMobil yesterday sparked another round of cuts at the pump. It trimmed prices by a tiny 0.1-0.2 of a cent per litre - after claims by Singapore Petroleum (SPC) that it offered the lowest prices.ExxonMobil's move, from 11am yesterday, was quickly followed by Shell at 1pm and Caltex at 3pm".

Yes, they let the Singaporeans have it. Free to decide on whom to patronize for the cheapest petrol. What a wonderful market to be in - fair competiton and level playing field. Competition is always good for consumers. Is Malaysia following Singapore's footstep considering petrol price increase is as frequent as changing an underwear? The rationale may not be in Malaysia - Is it because of Petronas? Or a similar case of Proton protectionism?

Maybe the law allows such practice to happen to appease Singaporeans as Singapore has the highest petrol prices among ASEAN 4 countries. Petrol prices are about US $55 cents per liter compared to 22 cents per liter in Malaysia. The Singapore government really takes care of its consumers. High priced but fluctuating prices at stations, limit on petrol fill up at service stations across the causeway (Malaysia) and artificially high vehicle prices (COE). Maybe it is fun to drive a vehicle in Singapore these days........

Bricklin should consider Proton too !!!

2005-03-31T22:26:00.000-08:00

I guess everyone knows or at least heard of Malcolm Bricklin.

He made headlines in the the US by planning to infiltrate the US market with Chinese made cars called Cherry. Some discerning consumers might have acknowledged Bricklin's notoriety when he introduced Yugo cars. Yugo failed miserably with its shoody built being the talk of the town. Bricklin was never heard since.

This time around he is into another auto revolution albeit much wiser. Due to the boom in China auto market, he is scouting for some good deals in cars. He discovered Cherry, low priced car range with acceptable that may appeal to US consumers who are distrught with rising car and fuel prices.

Would American consumers buy it? Maybe Bricklin should consider Proton namely the Gen 2 as a supplement to its Cherry lineup. Gen 2 has the least Japanese DNA - chance to make waves with a new brand too, enticing looks, OK quality and competitive prices. Prices can be brought down further to penetrate the US market. Looking at looks and performance of Gen 2, Gen 2 should kick some ass in the US. Come on, Bricklin, follow in the foot steps of Volkswagen in finding the gem in Malaysian auto industry.

Thailand might in vehicle exports

2005-03-30T15:34:00.000-08:00

Thailand - the Detroit of Asia and the leading vehicle producer in ASEAN.

What I admire about Thailand auto industry is that it is export driven which literally means they are world class with little margin for error. Of 155,098 vehicles in produced in January and February, one-third or 51,347 units were exported - an increase of 11 percent over last period export. The jump indicates Thai made vehicles are in demand. How sweet it is - Wish the Malaysian auto industry achieves similar feat.

Unlike Malaysia, Thailand is a pick up truck country. Similar to the US, minus the cowboy attire of its drivers. Thailand has become more proficient in pick up truck manufacturing that they are now ranked second in the world in pick up truck exports.

What about their car production ? Is it as robust as their pick up truck segment ? During the first two months, only the passenger car segment suffered a drop in production. Production dropped 13 per cent to 42,285 units mainly in the 1200 cc to 3000 cc category. Are they slow in making progress in the passenger car segment? Too early to tell. But it is a welcome reprieve for the Malaysian auto industry struggling to retain the title of the largest passenger car market in ASEAN.

Honda motorcycles upbeat about its additional plant in Indonesia

2005-03-29T17:02:00.000-08:00

Industry players take note! Indonesia is the third largest motorcycle market in the world. If you are not marketing your bikes in Indonesia you are making a grave mistake. Just ask the giant car manufacturers who entered China late or not at all. Even Malaysian owned Modenas sells its bike in Indonesia - and did fairly well in 2004.

Indonesia sold about 4 million bikes last year – a stupendous growth of 39 percent over 2003 sales numbers. And the growth appears unabated. In an association meeting that I attended recently in Indonesia, the industry targets 1 motorcycle for every 4 people in the next five years – from the recent density of 1 motorcycle per 10 people. Indonesia's enormous population is such a goldmine - an untapped market waiting to be filled. Its motorcycle population also is an eye opener - almost 21 million of motorcycles on the road - a fortune for spare parts manufacturers.

Honda is the market leader in the motorcycle market – a formidable competitor who churns out quality reasonably priced bikes. Its leadership was challenged a while back by cheap Chinese bikes manufacturers. But the Chinese glory was short lived. Consumers came back to Honda. However, this time around, the threat is becoming more real. Local market followers like Yamaha and Suzuki are mounting a credible attack towards Honda’s reign in Indonesia.

Honda is not sitting on its laurels. The decision to invest in a third factory in Indonesia is a wise move for Honda. Apart from being able to produce more bikes, Honda is banking on the new factory for fresh new models to further cement its position in Indonesia. New models are like appetizers to the customers whom are swayed by marketing gimmicks and flashy new look of competitors bikes. But getting the new models out as quickly as possible from the Indonesian factory, Honda has already won half of the battle.

A reversal effect of AFTA

2005-03-28T17:03:00.000-08:00

Yeah, we have heard it all the time. The never ending saga of tariff relaxations and car prices in the Malaysian car industry. The AFTA chronicle championed by neighboring ASEANs but loathed by the Malaysian consumers. We love AFTA for its free trade objective but the way it is being reoriented here in Malaysia is a call for frustration. Due to AFTA car prices should come down hard - Right?? NO, at least not in Malaysia. Poor Malaysian consumers - having been deprived of cheap quality foreign cars for some time.

You guys vividly remember when AFTA created a chaos in Malaysia last year? The tariff reductions were mitigated by excise duty increase. Car prices never budged some slightly higher. A strange phenomenon. More surprisingly, consumers went out on a car shopping spree. To them, waiting for miracles is a futile approach. The solution - Stop any news on AFTA impact on cars - price reductions are not imminent, the consumers are tired of reading about it.

They never did learn their lesson though. Today, a story came out saying that fiscal incentives for local car assemblers would be withdrawn. OK, at least it concerns the manufacturers but the actual impact would still be on car prices and consumers. So, in the end higher car prices. It is still OK - the consumers are ready with a pocketful of cash.

Malaysian success story in Thailand

2005-03-27T15:27:00.000-08:00

A full page news today on Malaysian auto companies abroad. Two Malaysian automotive parts companies making it big in Thailand: Sunchirin and Ingress. These two names are fquite synonym to the automotive world in Malaysia.

But the one that really impresses me more is Ingress. From a Proton vendor to a formidable player in door sash manufacturing in Thailand ( customers include Ford and Honda Thailand). Their products have to be good - they have been supplying to Ford for quite some time with Honda being the recent customer. I guess Ingress learn a lot about quality during those days in Proton (kah kah)

Hey! where are the rest of Malaysian auto parts community? Proton or Perodua vendors? Aren't you guys interested in exploring other turfs? With the spectre of liberalization becomes a reality, why are you guys still pleading for local contracts? Are you guys hypnotized by Proton? Or just plain lazy and incompetent- citing inadequate time as an excuse.

Recent meeting with the industry officials in Malaysia would not do much good unless one assess its own weakness and focus on key elements to succeed globally. I am sure Ingress and Sunchirin would not mind passing their regional stardom tips to homegrown companies. They have a lot to teach us if the local boys just to sit down, listen and stop bickering. The silver spoon era is long gone with both parents (Proton and Perodua) getting whacked from all angles. It is high time the parents hand over the cane to the vendors to whallop themselves.......

Honda Ridgeline - Are we getting them in Thailand and Malaysia?

2005-03-24T15:18:00.000-08:00

Gorgeous, awesome, magnificient, versatile are words describing the new Honda Ridgeline pick up truck. Even before it is made available, the vehicle has received rave reviews from consumers. Honda is well versed with the US market and is well ahead of its competitors in pushing stunning new models that sell. But for the Big 3, Honda Ridgeline is considered an onslaught towards their dominance in the truck segment.

Meanwhile, Honda vehemently denies that. Honda believes that it is their obligation to provide a variety of vehicle types to suit changing income and lifestyle. It is one of Honda's customer retention strategy. Very smart indeed.

What about we customers in ASEAN namely Thailand and Malaysia? Thailand is the second largest pickup truck market in the world while Malaysia has a legion of 4X4 enthusiasts. Are we getting the Ridgeline?

Hope Honda realizes that consumers in these two countries are yearning for newcomers to add to their pickup truck portfolio. Has Honda pondered on the amazing success of Nissan Frontier pickup in Malaysia? Is Honda not interested in joining the battle in Thailand's gargantuan pickup truck market? The Ridgeline may cause shivers to Isuzu D Max in Thailand.

Maybe Honda assumes ASEAN consumers are quite content with the Honda CRV. In reality, ASEAN consumers are clamouring for some radical changes in the automotive industry as evidenced by the strong growth in sales in the region in 2004. That is ASEAN.

American's ugliest cars - the ASEAN context

2005-03-23T16:32:00.000-08:00

Last week I came across an article in one of the US websites (I can't recall) a ranking of the 10 most ugliest cars in the US. A pretty interesting article indeeed. Just wondering who is responsible for compiling the list and how the survey was conducted- the writers own interpretation or public opinion.

Whatever it is, I have to agree that Ford Pinto is the ugliest car in America and the shoddiest built. I know since it was driven by my room mate while we were studying in Birmingham, Alabama. We even call him Ami Pinto for driving a battered, smudge blue Pinto. It was hillarious. We could actually know he is about to come home from the din the car made miles away.

What I would like to see is the same ugliest car list in ASEAN countries. I would love to spearhead the project due to my familiarity with these market. But unlike the US, where the cars are produced in the US itself, in ASEAN, cars are predominantly imported. Therefore, I would like to add a certain twist to the ranking. Cars included in this category can include those that undergo extreme modifications like for instance (jeepneys in Philippines - an art actually), old version of Toyota Kijang in Indonesia ( the slanted nose makes it look like a kijang(deer) and also new cars with blemished appearance ( Honda Accord running with two spare tires at the back). The list goes on and on.

I predict the list is going to get bigger in the ensuing years as ASEAN countries like Thailand, Malaysia and Indonesia are moving forward to designing and manufacturing cars from the current practice of vehicle assembly. Maybe the cars designed share the same fate as the Pintos or maybe not. If they come out pretty, then I should stick to my original segmentation.

Indonesia fuel price hike -A bane to the auto industry and consumers?

2005-03-22T15:25:00.000-08:00

Malaysia - Proton plans to double its new Gen-2 sales, can it be achieved?

2005-03-21T16:00:00.000-08:00

Well, that was the highlight on Malaysian automotive today 22/03/05. For those unfamiliar with Proton, Gen 2 is the first car designed, engineered and manufactured by Proton Malaysia using indigenous technology and local Malaysian engineers - with technical assistance from its subsidiary Lotus of course.

To date, Proton recorded close to 30,000 units of Gen 2 and expects the figure to hit 60,000 units next year. The news was quite a surprise actually after a string of bad news and quality issues plagued Gen 2 cars in the past year. I am sure die hard Proton fans and critics could vividly recall the image of a Gen 2 being caught on fire - due to an engine electrical failure. Well, maybe its Gen 2's first batch of production - when glitches are highly anticipated.

More importantly, the 60,000 sales target is quite aggressive considering Proton plans to introduce three new models to replace its aging model line up. Not only Gen 2 has to compete with new Proton models but also with the wide array of foreign cars that has been swarming the Malaysian market lately. Fyi, Proton's market share has declined in the past three years due to keen competition from foreign rivals like Kia, Honda, Nissan, Toyota etc.

To sum up, Gen 2's strategic plans and Proton new models might boost Proton's flagging market share but Gen 2's 60,000 sales is quite a grandiose ambition.