Monday, July 30, 2012

Unimaginative and No Substance

I do get the feeling that whenever someone from the opposition starts putting up an idea of lowering taxes and duties for buying cars, the ruling party will start saying the similar pattern - "if you do this the country will go bankrupt". Notable opponents of the idea as in order include Khairy Jamaluddin, Ibrahim Ali, Chor Chee Heung and of course Nor Yackop.

Apparently the idea of protecting Proton and to promote the national automotive industry seemed to have ended up on the wrong endpoint already. If you look at the diagram above, getting a Toyota Altis in Indonesia is far more easier than getting one here. 

Here's a simple diagram for illustration:

This is what Finance Twitter elaborated:

“Dollar for dollar, people are still wondering why locally designed and built cars are still more expensive than imported foreign cars in the same class.

“In the 1.6-litre segment, a latest 2012 Ford Fiesta costs about US$16,000 in the US but a local Proton Persona costs a whopping RM49,000.

“A new 2012 Toyota Camry 2.5-litre in the US costs merely US$30,000 (about RM90,000) but it is costing you a leg and an arm at RM183,000 here,” read its article.

The article stated that Proton reaped huge profits due to the protection offered to it by the government and this had bred arrogance.

“Proton became arrogant and didn’t care about quality so much so that its local buyers were left without any solution for decades about its once-infamous-power-window problem,” it added.

Between a car and a house, a car is much more indispensable compared to a house. Although some argue that the car's value depreciates in time, like a mineral in a half-life cycle, nonetheless, the house can be acquired not by buying but by renting. For instance, if we decide to buy an Altis, the extra 65 thousand ringgit that is used to for paying three varieties of taxes can be used for advanced monies of buying an apartment or a small house.

Remember that in a recent economics report, the property value in Klang Valley is 5 times more than the income of an average professional, meaning that the chance of a person, particularly those who have just started working in the professional world is absolutely zero and they would be shut out. Similarly this happens if they decide to get another car. A car's primary purpose is to take a person from point A to B. Without it, it would be hard for person to perform a job. There are certain places that proven to be difficult to be accessed via public transport. That is a fact established based on the present transporting situation in town.

I couldn't find much substance and only could think of flawed logic spoken by those people whom I mentioned above. The main goal is to keep it status quo and let the people bleed in money to get what is now considered the fourth basic need in addition to food, clothing and shelter. Talking about country economy being unstable if these excess duties and taxes are removed demonstrates the lack of imagination and creativity demonstrated by our present crop of leaders in the government of the day 

It is actually possible to think other ways to generate country income instead of relying on taxes. The people who scream of Singapore in the past eventually should realize that they have already lost out to their neighbors as they,  looking beyond the veil of racial topics have put themselves and use many ways to make themselves as one of the AAA credit nations (in fact the only one in South East Asia). They have the readiness to withstand the Eurozone crisis, with the vast amount of plans in hand. And we have nothing to prepare in hand. In fact the Roubini Group (Dr. Doom) has predicted Malaysia will be one of those hit by the sneeze badly. I would dare UMNO people to scream over that statement.

It becomes a flip that Proton eventually made losses but still gets protectionist money from the import duties and taxes imposed on other cars or when Dr. Mahathir admitted that he favors high-end European / Japanese cars after his retirement from office in 2003. With that latter admission, it has become visible that the goal of the NAP is already unsuitable and needs to be rethink of. Out of the prominent people that talk about no to the idea, Ibrahim Ali and Chor's idea are those examples of people lacking imagination and substance, all just talk trash and crap. Proton, while having those things to cover their back have become complacent and taking it off is timely enough to get them to fight harder in the competition.

Getting car is a priority for many young people right now, even if it's getting a small Kelisa just for the purpose of transport - but not to the extent of making people saving money for many years before getting one. Need I remind that the monetary value of the ringgit and purchasing value is getting smaller and smaller each day and the ringgit is now in a very weak position against the majority of basket of currencies including the neighboring Singapore dollar as well. And we have done nothing against it. Have we forgotten about buying power? A person from China can buy three times a person wants to get here.

While these people talk about "country going bankrupt" if Pakatan does that, need I remind those people that there's mischief that they're trying to hide. For instance, Chor Chee Heung and his then Home Ministry head Syed Hamid Albar were responsible for the surge and lax of control of immigration labour-level workers during the Pak Lah years. It was he who said of "service tax" for credit cards (remember?). Nor Yackop, is of course had a fair share of blame for the early 90's forex scandal (remember Black Wednesday?)

On the other hand, for Rafizi Ramli and co, we would like to see you guys illustrate and example of how one can buy a car at a removed price while economy would not be affected in claims with what the few people talk about. Why not demonstrate to the people us in a road show then as to say it is possible, not some imaginary claim?

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