Is the Asean car project between Malaysia and Indonesia dead?

Is the project for an Asean car between Malaysia and Indonesia a forgotten one? What will it take for the two nations to achieve this dream?

It is Malaysian Prime Minister Dr Mahathir’s dream project. He is a car enthusiast unlike Joko Widodo, the Indonesian President who prefers to ride a motorbike.

Indonesia its own car project in the long distant past. The company behind their national car abandoned the project as a result of the political change in 1998.

From General Motors’ assembly plant to the importation of semi-knocked down to complete knocked down units, the auto industry in Indonesia is at a standstill.

Then came the Timor project, abandoned in 1997 because of the Asian financial crisis. But there were problems with Kia Motors which was facing its own crises in South Korea.

The idea of an Indonesian national car project dates from the 1950s with President Sukarno’s nationalisation of the GM’s plant.

However, the industry did not really pick up steam, unlike the national car projects in Malaysia.

Proton in Indonesia?

But in 2015, Proton, then still a Malaysian national car, signed an agreement with an Indonesian company PT Adiperkasa Citra Lestari.

The plan was to develop and manufacture an Indonesian national car. It was just an MoU but nothing happened in between. Proton got sold off to the Chinese and this may have killed the project altogether.

Before that the then retired Dr Mahathir took Joko Widodo for a spin in the brand new Proton Iriz EV. In 2018, Dr Mahathir visited Indonesia. 

He told the media his government may revive plans to develop a car with Indonesia, which would be sold across Southeast Asia. The car is to be jointly developed by Malaysia and Indonesia.

The same year, in Japan, Dr M told the media he hoped to begin a new car project. A private company in association with the Malaysian government recently launched the third national car.

The Asean car project was Initially floated years ago but Proton and PT Adiperkasa shelved the project.

Motorbike rider

Jokowi visited Malaysia last week and the big story was Dr Mahathir driving him around again in a Proton.

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Nothing new here, except that Mahathir is now the Prime Minister, and a video shows his driving skills on wheels.

During the drive, Jokowi signals that he is not a car enthusiast, but he is a motorbike rider.

His popularity grew after he released a video of him riding a motorbike to deliver a speech during the Asian Games 2018.

In January 2018, Jokowi purchased a custom motorcycle, a Royal Enfield Bullet 350cc in chopper style.

It is a modified Chopperland from the Elders Garage workshop. according to a Jakarta Post report.

The aim was to boost local businesses. Well, how do you get a motor rider who does it in style (see the video above) to start a car project?

After the multiple failures at Proton, it is obvious it will be a hard sell to jumpstart an Asean car project.

Why an Asean car?

There was a time when Proton was exploring a possible partnership with Geely or other China carmakers to develop an Asean car.

Geely’s interest in Proton is the potential access to other Asean markets. The Chinese company has not said its last word on its Asean interests.

It should not be discounted as a partner in an Asean car project which would give it free access to other markets.

Malaysia is a small market, but the premium in buying into Proton is the huge Asean market of 600 million people.

It is all about business but why an Asean car? Will it be a car with an Asean logo?

Nevermind the modus operandi. The point in these talks for an Asean car is to capture the huge market space.