The Sun Editorial: Make the Economic Decision for Proton

This is why I read The Sun. Besides the fact that it's free ;p

Apart from foreign newspapers, it seems to be the only mainstream purveyor of news that dares to call the goddamned kettle black!

At the end of the day, economics must dictate the final decision over Proton - not misplaced emotion and nationalistic fervour which tend to cloud the situation and be abused by other self-seeking parties to further their own narrow causes.

Read its editorial about Proton's Problem below.

Make the economic decision for Proton

Enough time has been spent already over what to do with Proton and the ongoing negotiations with various parties for a revival of the ailing first national car manufacturer, hit with a lack of marketable models.

What needs to be done is to take some hard decisions based on reason and logic with emotion out of the general picture. There are ultimately only two parties whose interests need to be considered - the public and Proton, together with the industries around it.

The more we can get the interests of the two to coincide, the better it will be. But there are forces preventing this which appeal to the nationalistic instinct but are clearly after Proton for what it can offer to their own ailing businesses.

One has to remember that Proton is in no position to help anyone else - it is in critical condition and has to help itself first. Can it do it on its own? No, it is in dire problems simply because it has not been able to develop the kind of models the public craves.

That is no shame - some of the best car companies in the world have failed and needed rescue. The nature of the industry is that development and design costs are too prohibitive for a small manufacturer such as Proton. Proton needs a partner.

To bring in a foreign partner, Proton has to give something - control of manufacturing and development operations in return for technology and for the greater number of cars produced - not just for the Malaysian market but the regional market as well.

Malaysian equity interests in the enlarged Proton will be smaller, but Proton will eventually become much larger and stronger. All the industries around it - distribution, parts manufacturing etc - will thrive too with the right foreign partner which will want Proton to succeed because it's got a meaningful stake in it.

And that's the right thing for the car-buying public as well because good cars can cost less and with more cars produced and economies of scale, the government can roll back protective tariffs, allowing yet more choice to the buyer.

A viable, competitive Proton, not just locally but regionally and internationally, will permit the opening up of the motor sector and encourage foreign manufacturers to set up operations here to supply and service the regional market. After all, Malaysia is the largest car market in Asean.

At the end of the day, economics must dictate the final decision over Proton - not misplaced emotion and nationalistic fervour which tend to cloud the situation and be abused by other self-seeking parties to further their own narrow causes.

Neither Proton, nor the country, needs that.