No Proton, no car industry?

NOV 8 — Tun Dr Mahathir Mohamad, the man behind Proton, infers that without the national car company, there would be no car industry in Malaysia. Can that really be true? And can it really be so simple? No Proton equals no automotive industry? After all, it wasn’t as if Malaysians only walked before the Saga came along.

On the flipside, we also have people who continue to spend time trying to determine if, had there never been a Proton, we would not be better off than where we are right now. The answer from them, as I’m sure you can imagine, is often a resounding yes.

The problem is, however, people generally suck at determining causality. Whether you choose to view it as an inherent human flaw or endearing characteristic, people are prone to seeing what they choose to see. Sometimes even to the point of doing so in the face of contrary evidence.

Often, people confuse an accompanying sign or condition as the cause of an occurrence. Take for example the classic lesson in determining causality: Do storks bring babies or do babies bring storks?

Following the end of the second World War, population in Western European cities rose steadily. As it happens, this was accompanied by a similar increase in the population of storks in these areas. To the casual observer, it would appear that there is a strong correlation between the rate of growth for humans and a similar rate in storks.

Having observed that link, you’re tempted to ask whether there are more babies because there are more storks or more storks because there are more babies. The answer, of course, is neither.

What happened was post-war Europe saw a migration trend towards built-up areas, which resulted in higher urban population densities and increased birth-rates. So although there was an apparent connection between the numbers of babies and storks being born, the cause of both was determined to be the increased rate of urbanisation.

Storks, therefore, didn’t bring more babies. People did. The same went for storks. With a growing populace came the need for additional housing, which subsequently provided more nesting area for the storks. Which meant babies didn’t bring more storks. Again, people did.

Once someone points out the actual causality, the earlier assumption that there is causality in the correlation between the number of storks and the number of babies becomes preposterous. Yet people had no qualms spending time trying to determine causality where there was none.

Having revisited correlation and causality, is Dr Mahathir still right? Would Malaysia really have no automotive industry if the national car policy was not implemented back in the 1980s? But before you even go there, it’s important to define what constitutes an automotive industry.

Dr Mahathir likely (I’m guessing) considers an automotive industry to mean automotive manufacturing — cars and parts. The inference then is that sans Proton it would not have been possible for the ancillary industry to take root and flourish. The probable logic being with no national car company to supply parts to, nobody would bother to set up companies to supply parts.

Of course, you could also choose to define an automotive industry as everything that concerns vehicles minus the manufacturing. There’s still a lot of money to be spent — and made — long after buyers sign on the dotted line.

If you take the first definition, then Thailand serves as the counterpoint of just how possible it is to have not only an automotive industry, but a thriving one at that, without the hassle of setting up your own national car company.

Detroit of the East may be a little flattering for Rayong, but there is no hiding from the reality that Thailand has far surpassed Malaysia as the preferred destination for foreign car manufacturers planning to set up shop in the region.

At nearly 1.5 million vehicles, Thailand’s vehicle assembly plants churn out three times as many vehicles as their Malaysian counterparts do, all the while supplied by parts suppliers who never had a national car company to supply to. So no Proton means no automotive industry, still?

If you prefer the definition that omits the manufacturing side of things, then Singapore provides a prime example of a thriving automotive industry that has little involvement with factories and assembly lines.

Before you dismiss the little red dot as an automotive industry, know that Singapore car sales practically match our own, with over half a million cars sold a year in the tiny island-state. Half a million cars that need spare parts, accessories, car care, prestige parts, and more. There must be money in all that.

Not only does Singapore not have a national car company, it doesn’t even have all that many roads to drive on. Not even remotely as many kilometres upon kilometres of shiny highways as we do. So no Proton, no automotive industry still?

This is not to say Dr Mahathir’s inference is categorically wrong; it could really have been that Malaysia was so hamstrung that without the catalyst of Proton’s inception, we would have continued grinding away in neutral while our neighbours passed us by. Who knows for certain if that truly was not the case? Now, at least we’re in first gear, even if our neighbours are still passing us by.

My intention is to point out that without Proton or a national car company or protectionism, it would have still been possible for Malaysia to have a successful auto industry. Our neighbours to the north and to the south show us that this is so. Just because we have Proton doesn’t render all other possible outcomes null and void.

The only thing that is truly certain if we did not have Proton, is that there would be no Proton. Nothing more, nothing less.

Anything else and you’re just making things up.