Prime Minister Datuk Seri Abdullah Ahmad Badawi claims that the government has stopped Proton’s protective policies because it has started up programs like the Industrial Adjustment Fund which exempts excise duty payment depending on the how much the manufacturer has invested in Malaysia.
“The Government has implemented various measures such as giving incentives and grants, technical training through international strategic partnership, which also benefit the entire industry,” said Abdullah.
Since prices have not really come down in the past few years (manufacturers who wish to keep their strong brand loyalty and perception of good second hand value which Malaysians consider important when purchasing a car will never suddenly drop the prices of their cars because they do not want to anger their existing customers by having their car’s second hand values affected), these non-national manufacturers who have benefited can channel the money into a) increasing specs, b) increasing marketing expenditure to increase sales or c) laugh all the way to the bank.
There has not been and probably will never be any disclosure on which companies are getting duty exemptions, but we can see some form of relaxation in policies here and there. For example, Cam Soh finally managed to start assembling his Chery vehicles here – vehicles which are priced rather closely to Proton’s.
RM400 million for Proton vendor development