1. Malaysians are perpetually complaining about car prices being too high in Malaysia. Yet we should know that on a per head basis, there are more cars in Malaysia than all the other Asean countries.2. Already there are traffic jams all over K.L., many half a kilo long!
3. It takes half an hour to move just one kilometre. If we lower the car prices, more vehicles will be on the road. And of course more and longer traffic jams. The jams also contribute much to pollution in K.L. as the engines run but the cars are going nowhere.
4. Actually the price of cars is high because we want to limit the consumption of fossil fuel. The big-engined luxury models are taxed 300%. Otherwise the rich owners would enjoy the subsidy more than the owners of small cars.
5. I believe these rich people will still buy big cars even if the tax is higher.
6. There was a time when Government protection of Proton was high that it won 80% of market share. Today it has only 26% of the market.
7. If it goes down further we may have to shut down Proton.
8. This will not lower the prices for foreign cars. The Government would still have to recover subsidy cost. But some 150,000 jobs generated by the national car industry will be lost.
9. There will be a big outflow of foreign exchange to purchase imports. We will lose much of our engineering capability which in turn would lead to more job losses as engineering-based industries cannot fund skilled workers. There will be more outflow of funds.