Proton Vendors Association defends Malaysian parts

Proton LogoProton Vendors Association President Dr Wan Mohamed has spoken in defense of allegations that automotive parts sourced from Malaysia can be up to 50% more than those made in Japan. He says that these studies comparing parts prices have questionable materials and methods and even then, they only reveal parts prices between 5% to 15% higher than those in Japan, and in selected sub-sectors only.

According to Dr Wan Mohamed, the Perodua Myvi and Perodua Viva achieved a market price lower than its predecessors because of its 80% parts localisation compared to the Kelisa’s 65% local parts. He argued that if Malaysian parts was indeed more expensive, the cheaper prices for the new Perodua vehicles could not be achieved.

He also cited a few examples on why Japanese parts can be priced cheaper including lower finance charges of as low as 1% per annum for Japanese automotive vendors, lower cost and easy availability of raw materials in Japan, lower mould, die and production line costs, lower amortization and depreciation costs, and a higher degree of automation that Malaysian vendors with lower economies of scale cannot achieve.

He also added that Malaysian vendors have higher levels of wastage due to process rejects due to lower input in R&D but did not go into detail.

Related Posts:
Muhyiddin: Proton’s vendor network needs “discussion”

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Paul Tan

After dabbling for years in the IT industry, Paul Tan initially began this site as a general blog covering various topics of personal interest. With an increasing number of readers paying rapt attention to the motoring stories, one thing led to another and the rest, as they say, is history.

 

Comments

  • jolly_idiot (Member) on Jul 25, 2008 at 10:17 am

    I tot G urges us to support BUATAN MALAYSIA is becoz we can get a cheaper price (not to say on the quality). Looks like it’s not the case and we are paying more for it.

    Then should we support ‘BUATAN MALAYSIA’? If that’s d case, we better switch to Japanese parts since it’s cheaper and better.

    Like or Dislike: Thumb up 0 Thumb down 0
  • alique (Member) on Jul 25, 2008 at 10:18 am

    did anybody heard about power window problem from new Saga and Persona?

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  • kerelbort (Member) on Jul 25, 2008 at 10:54 am

    alique : NOPE!

    Like or Dislike: Thumb up 0 Thumb down 0
  • notsleepy (Member) on Jul 25, 2008 at 11:22 am

    It reflex in a spare part shop. Ori,Japan or local? I always answer Japan.

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  • 4G63T DSM (Member) on Jul 25, 2008 at 11:40 am

    So he agrees that we are indeed paying more for spare parts.

    Why is this Proton guy, talking about Perodua spareparts?

    I don’t get it. First he says not to compare with “oversea” spares of “questionable quality”, as if we do not get questinable quality in parts we get from a proton parts dealer….then he says not to compare because local sparts suppliers have higher rejects due to bad R&D.

    I’m sorry, higher reject =/ bad R&D. Bad R&D = subpar quality, higher rejects = subpar production..shees…. either way makes for lower quality expensive parts. Does he even know what he is talking about???

    Talking about shooting oneself in the foot.

    Typical excuse ridden answer. Immensely long winded answer, that well, answers nothing…..

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  • medca (Member) on Jul 25, 2008 at 11:40 am

    come on…”easy availability of raw materials in Japan”…he must be kidding..tsk tsk tsk

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  • onzetool (Member) on Jul 25, 2008 at 11:56 am

    Yesssssss…..
    Our local price is expensive!
    If we’re going to dump all our local products because of higher cost,
    than, the same thing we should tell the Agri. Ministry (his previous ministry), that they should abandon all their project and close the ministry because we can import all of our foods cheaper fr. Thai, Indonesia, Myanmar, etc.
    So think friends…

    To Dr Wan Mohamed,
    Bring Muhyidin to visit all the vendors and have a look at their (ailing) conditions before giving further conclusions/comments. Maybe his reclining chair is to comfortable to be left for field visit.
    What about raw materials problems, have the Govt. do their very best?????
    Steel supply, Engineering plastic supply, Tooling Material and Technology, and so forth….All are imported!
    Then the sleeping Perwaja, Megasteel, TPM, Sirim, etc…
    NOOOOOOOOOO!

    THIS IS THE PROBLEM OF OUR TYPICAL MINISTERS…
    BEING PAID TO GIVING EXCUSES AND PIN-POINT..
    NOT TO SOLVE PROBLEMS

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  • sphiroth (Member) on Jul 25, 2008 at 11:58 am

    It can be seen that politician, Proton, SC and Vendors are playing Tai-Chi. Everyone said the other party is the wrong one. :)

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  • torque (Member) on Jul 25, 2008 at 12:04 pm

    What the heck is he talking about? Why does all these dumb statement being made publicly without thinking it might bite them back? Kata suruh sokong buatan Malaysia tapi kata buatan Malaysia teruk sebab kurang R&D, apa ni?! Cakap tagalog ke?

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  • Roti Naan (Member) on Jul 25, 2008 at 12:32 pm

    “”…..He also added that Malaysian vendors have higher levels of wastage due to process rejects due to lower input in R&D but did not go into detail””.

    if that is the case, Let me solve the EASY problem for you. — TUTUP KEDAI

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  • Max88 (Member) on Jul 25, 2008 at 12:53 pm

    “According to Dr Wan Mohamed, the Perodua Myvi and Perodua Viva achieved a market price lower than its predecessors because of its 80% parts localisation compared to the Kelisa’s 65% local parts. He argued that if Malaysian parts was indeed more expensive, the cheaper prices for the new Perodua vehicles could not be achieved.”
    >> Why cite Perodua? How about Proton itself? If Proton Waja, Pesona selling at current price RM60K to RM65K then if compete on open car market, the price will be at RM30K-RM35K? In a mummy-breastfed, artificially protected car market like now, cost issue is irrelevant. Can you tell Proton now offering a real or artificial price? The fact that Perodua being mentioned is because Perodua is our ‘localised’ Toyota. Most people buying Perodua because of its Toyota/Daihatsu origins and funny how it will be potrayed as doing a big sin just to buy a quality car other than buying Proton. Yes it is a big sin for buying Toyota-Perodua because you are no patriotic at all, even after you pay extra RM25K-RM30K car sales tax to govt.

    “He (Dr Wan Mohamed) also added that Malaysian vendors have higher levels of wastage due to process rejects due to lower input in R&D but did not go into detail.”
    >> Come on please, even non-PhD graduate (like you and me?) can tell you that the other ‘detail’ reason is just plain corruption. Even without/lower R&D the cost is higher, what more to say to incur more R&D cost?

    NAP – Never Against Proton
    NAP – Never Against Proton
    NAP – Never Against Proton

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  • trustgtr (Member) on Jul 25, 2008 at 1:03 pm

    viva cheap car is it?? what rubbish..perodua and proton way way over priced..

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  • trustgtr (Member) on Jul 25, 2008 at 1:06 pm

    the localization of suppliers are one of the main reasons that proton prices are expensive..allow them to purchase components from an open market, this will reduce their cost 30 to 50 percent..

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  • pippen (Member) on Jul 25, 2008 at 2:16 pm

    as i have repeated mentioned it various time, the whole Msia fall out will be caused by the cronies. Whether it’s charge extras (you think for no reason), and any one check the Merc they bought? (dont forget, the G oso earn import tax from there). The whole systems is rotate about the $$ for them. The bs about the parts being more expensive in Msia say it all, and moreover, we are buying a car more expensive than outside of the world. Waja onwer paying price of a Civic, Civic owner paying a price of Camry, and Camry ownder paying a price for Merc/BMW. Those import tax obtained, those local car parts supplier is a big chain of the $$ cycle for them. If government wants to help, its using the Petronas money to help Proton is selling cheaper car by doing all those policies like mentioned in Japan (lower interest rate for them), and R&D (common, anyone beliver in R&D in Proton now?). Not forcing the people to buy expensive proton car than open market price car with half the quality, but only benefit the cronies, which ultimately killing the Malaysia in the global market. They have not see the globalization coming. With interest rate going up again (again, an ill advised economic steps for inflation), government really NEVER apply any policies benefits the people.

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  • Cire (Member) on Jul 25, 2008 at 2:41 pm

    Why perodua is much more competitive than proton..simple..its because perodua is not managed by a bunch of money-sucking team that is groomed by a sleeping G that all 365days living in denial of every wrongs that the rakyat is saying.
    Every year in japan, vendors are required to reduce its cost of sales to the car assembly plant. Probably this is how perodua managed to keep the cost . But in msia, every year, the cost keep on going up ..into the pockets of cronies? Where the goings get tough, parts quality and R&D allocations is shaved to so that the cronies still got their “earnings”..

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  • mokkf82 (Member) on Jul 25, 2008 at 2:43 pm

    Seriously, by looking the way he comment he already starting to condemned himself being the president of Proton Vendors Association.

    And what the hack he is talking about, saying local source was expensive. I thought you guys look for local source due to the main reason of pricing issue.
    Ask any of the purchasing in any of the company that doing local sourcing, are they not do this because of pricing issue of oversea parts? and now you are saying local parts expensive? Crap!

    Comment about wastage, have you guys really see Proton Saga driving on the road? Cause i hardly seen any. Do they on-holding any of it? or they scrap it?

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  • catchcart (Member) on Jul 25, 2008 at 3:00 pm

    Hello all,

    Here is the manufacturer of some parts for Proton Cars, refer to this link

    http://www.multicode.com.my/product.php?cPath=9

    and below is the list of the director (as you guys mention as cronies).
    Tell you what, call them and tell them about your problem relating to the part they manufacture.

    Multi-Code Electronics Industries (M) Berhad
    (193094-K)
    CORPORATE INFORMATION
    BOARD OF DIRECTORS
    Chairman Dato’ Haji Sulaiman Bin Ahmad (Non-Independent Non-Executive Director)
    Managing Director Goh Tong Huat (Non-Independent Executive Director)
    Directors Goh Kar Chun (Non-Independent Executive Director)
    Goh Chai Siong (Non-Independent Non-Executive Director)
    Nora Lam Siew Wan (Non-Independent Non-Executive Director)
    Dato’ Mohd. Nadzir Mahmud (Non-Independent Non-Executive Director)
    Dato’ Bahari Bin Haron (Independent Non-Executive Director)
    Huang Yan Teo (Independent Non-Executive Director)
    Chai Lai Koon (Independent Non-Executive Director)
    Goh Kar Houl (Alternate Non-Independent Non- Executive Director to Goh Chai Siong)

    Here is the complete annual report for this company.
    http://announcements.bursamalaysia.com/EDMS/subweb.nsf/7f04516f8098680348256c6f0017a6bf/0a23a5dc2a69f1304825723c00260231/$FILE/MULTICO-AnnualReport2006%20(586KB).pdf

    Cronies, eh? This is one of them…..you guys can start searching for them from now on…..

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  • JULIANLEE2 (Member) on Jul 25, 2008 at 3:01 pm

    proton is crap

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  • lomotus (Member) on Jul 25, 2008 at 3:21 pm

    Hahaha….
    Malaysia is a funny country, even LG CNS , the consultant for Proton’s new Saga model is puzzled.

    What seems to be very cheap in Korean cars, for example material A, when “asked” for a quotation from Proton’s vendor will “automatically” become expensive. The thing is, this same material A has been known for being cheap.

    LG CNS is a very experience automotive consultant, they have been doing design & development for so many years already but when it comes to sourcing in Malaysia, it is something they can not understand.

    These vendors are always finding ways to screw Proton because when they deal with companies like Toyota or Honda , who has vast experience in material cost, there is no chance to make easy money.

    The thing is Proton’s suppliers are limited and they have no choice but to go to this people. Sourcing from neighbouring countries like Thailand or Indonesia is out of the question. They will not get the support from these foreign suppliers because of the small volume.

    Another contributing factor is the man behind those suppliers, they are either politically connected to Proton’s management or they are ex-proton employees who setup their own business and still got connection inside Proton. Only a few are Internationally recognised suppliers.

    SO, WHAT CAN U DO?

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  • Roti Naan (Member) on Jul 25, 2008 at 4:00 pm

    Proton Car indeed has made 2 monumental achievement in the world ever.

    —Making the MOST LOUSY QUALITY car—

    —using MOST EXPENSIVE materials—

    So, Dear Malaysian. Do you think this is wrong? If yes, stop supporting Proton until quality improves, with realistic price tags.

    if not, Malaysian has no one to blame, but themselves. and they will become

    the —MOST FOOLISH people when buying cars in the world—.

    I how the day would not come….

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  • Mb_321 (Member) on Jul 25, 2008 at 4:33 pm

    what i know is, Proton go for cheapest quotation

    P2 go for reasonable price but if the product fail then the manufacturer will be fined

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  • mystvearn (Member) on Jul 25, 2008 at 6:14 pm

    Just admit it, parts produced in Malaysia are expansive regardless of what he says. P2 can make good cheap parts cause the car has been made elsewhere first, so come Malaysia only clone same material, no need testing. Proton vendors…hmm that is another story. Trial and error

    Like or Dislike: Thumb up 1 Thumb down 0
  • car_craze (Member) on Jul 25, 2008 at 6:30 pm

    Roti Naan,

    You better just stick to your roti Nan because your comments are NOTHING!

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  • lchan (Member) on Jul 25, 2008 at 7:43 pm

    I heard the QC department is quite bocor a few year ago and they were more like random rejection of goods department, which by next month, the same rejected goods are accepted.

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  • JULIANLEE2 (Member) on Jul 25, 2008 at 8:47 pm

    car_craze

    you have to accept other people’s comments, face the truth, proton is rubbish

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  • Roti Naan (Member) on Jul 25, 2008 at 10:17 pm

    car_craze,

    did you eat chili and therefore you feel hot?

    Anyway, I have my say and you can say whatever you wish.

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  • capeplates (Member) on Jul 25, 2008 at 10:26 pm

    Normally you get what you pay for i.e. cheap price cheap car mediocre end product. Proton is an exception overpriced poor quality. Forget Malaysia stick with Japan

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  • noactiontalkonly (Member) on Jul 25, 2008 at 10:45 pm

    Cire said,
    July 25, 2008 @ 2:41 pm

    Why perodua is much more competitive than proton..simple..its because perodua is not managed by a bunch of money-sucking team that is groomed by a sleeping G that all 365days living in denial of every wrongs that the rakyat is saying.
    Every year in japan, vendors are required to reduce its cost of sales to the car assembly plant. Probably this is how perodua managed to keep the cost .
    —————————————————————-
    p1 only shares about 46% of their vendors with p2 and toyota, therefore it makes sense to assume that a large number of them are still lacking the exposure to global reality. i’m not saying by being p2 and toyota vendors automatically qualifies a company to be world class manufacturer though..

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  • rajtheboss (Member) on Jul 25, 2008 at 10:48 pm

    Dr Wan Mohamed have to defend his people, no doubt everyone knows that proton parts are poor in quality but they make tons of money out of it.

    If proton used japan parts then local vendor has to “gulung tikar’. Dr Wan Mohamed got no income.

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  • osh_kosh (Member) on Jul 25, 2008 at 11:18 pm

    …. According to Dr Wan Mohamed, the Perodua Myvi and Perodua Viva achieved a market price lower than its predecessors because of its 80% parts localisation compared to the Kelisa’s 65% local parts. He argued that if Malaysian parts was indeed more expensive, the cheaper prices for the new Perodua vehicles could not be achieved….

    –> wow!! imagine how Viva price would be if using EXPENSIVE IMPORTED parts…

    Like or Dislike: Thumb up 0 Thumb down 0
  • topgunthang (Member) on Jul 26, 2008 at 12:00 am

    in essence what he is saying that we are paying more money for low quality parts (when there are high quality cheaper parts available) and you cant fix the problem free even if under new car warranty. And to top it off there is nothing you can do about it buy just keep buying proton cars.

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  • khengyi82 (Member) on Jul 26, 2008 at 12:43 am

    For those who driving proton then good luck, proton car is worst car i ever know. please don’t buy proton is the most dangerous car in the earth once u get accident confirm die inside nothing u can do because all the proton part no QC test no checking. don’t buy proton cars it will bring you to tell please please don’t buy proton car. low quality part high price because got gorverment support they don’t care about price trying to make it higher and higher until consumer said help help help until die. low quality must be low price but in malaysia low quality high price this is proton and malaysia gorverment culture. proton is brand to bring us to hell proton is the brand for you go to die proton is the way to let us die. please please i please you all don’t buy proton i pray you all don’t buy proton cars please proton i wish u close shop and open market. proton please go hell don’t bring malaysian to hell we love malaysia we hate proton ! proton please get out from our country proton 1 day u will know every one is hate this brand. EVERY 1 IS WAITING PROTON CLOSE SHOP, EVERY IS WAITING THE DAY COME !

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  • khengyi82 (Member) on Jul 26, 2008 at 12:55 am

    proton is the lousy cars don’t you all think what the fuck of our gorverment doing ? keep said this improve or what in the end nothing improve said this said that cannot la what la what hell of the proton, once proton cannot hit the market or anything they said this and that la what lan la STUPID PROTON ! so lan jiao wan wor. proton really a potong cars i wish the proton boss die faster and go to hell ! your mother fucker i hate proton ! every one is hate proton ! WHEN IS THE PROTON CLOSE SHOP ??? aAAAAAHHHHHHHH PLEASE PROTON PLEASE GET OUT OF MALAYSIA! proton really sohai take other brand engine then put in this call malaysia cars. FUCK U PROTON !! your mother proton pat pat ! i wish u die in the hell !!! PROTON GOOD FOR HELL !

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  • tikus (Member) on Jul 26, 2008 at 10:25 am

    No matter how you guys fuck proton but rakyat still buying it.Just see the booking for new Saga.Damn Tin can.

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  • Roti Naan (Member) on Jul 26, 2008 at 11:54 am

    Tikus,

    Guess the Saga’s saga continues….
    On the bright side, at least I’m not driving a Saga around….

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  • torque (Member) on Jul 26, 2008 at 12:06 pm

    Wow! Somebody didn’t got his coffee today….:-)

    Talk about frustration…

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  • topgunthang (Member) on Jul 26, 2008 at 6:46 pm

    proton and the government knows the public cannot hold out forever. they just need to play the waiting game. sooner or later you will have to buy the cheapest car you can afford which is the saga. keep the market closed and protected….sooner or later someone will buy no matter how lousy the product.

    btw….where did that space hitchhiker go?

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  • mystvearn (Member) on Jul 26, 2008 at 7:13 pm

    People are buying proton not because of they want to. Its more about the price. Make something slightly cheaper than the competitive price, people will buy it. No need rocket scientist to figure that out.
    BTW paul, British International Motor Show now on. No coverage?

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  • delos3nos (Member) on Jul 27, 2008 at 1:43 am

    ah yahhhhhhhhhh Malaysia now a days have nothing which is right, the only thing is correct, corect, correcttttttt, yes yes yes yess

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  • pdos84 (Member) on Jul 28, 2008 at 12:09 am

    hurm..

    Khazanah -> EON / Proton Edar -> Proton -> Proton RnD / LG Korea (proton designer) -> Proton Manufacturing / MIYAZU -> Quality Consultant (for Proton & MIYAZU)-> 1st tier vendor -> MIYAZU -> 2nd tier vendor -> MIYAZU -> 3rd tier vendor -> supplier (die&mould maker, jigs maker, assy-line maker) -> “specialist, technical adviser, engineer, technician, operator”..

    the chain is very good maa… everybody mau komisyen! hehehe
    quotation always need to revise due to high cost.. but net profit mau maintain for poket sendiri.

    semua itu KOMISYENNNNNN….!!!

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  • raverus (Member) on Jul 28, 2008 at 10:27 am

    Malaysia boleh, no matter how hard they defend it; WE KNOW THE QUALITY BEST……..

    IM A RIPPED OFF CONSUMER, DUH.

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  • soninspired (Member) on Jul 28, 2008 at 1:33 pm

    Crap.. nonsense… If low RnD.. then make it high la.. Expensive then make it cheap la.. If local stuff sucks and expensive.. better buy japan stuff.. Only give excuses but no action..

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