So it is finally out. China’s Zhejiang Geely Holding Group, which also controls Sweden’s Volvo, is acquiring a 49 per cent in ailing Proton Holdings Bhd from DRB-Hicom.
The Edge (15-21 May) had earlier reported that the government had extended a RM1.7bn credit line to Proton as a stopgap measure. Cash from a RM1.25bn soft loan last year had been fully used up to pay vendors.
But Proton sales have been falling for the last six months despite heavy marketing and three new models:
January – 7,207 cars
February – 6,099
March – 6,070
April – 5,600
Total – 24,976, which is still 5.4 per cent higher than last year, almost in line with the rise in total car sales (but 2016 was a bad year for car sales).
For the first four months, market share was:
Perodua – 35.4%
Honda – 18.9%
Proton – 13.7%
Toyota – 12.2%
And Toyota is poised to move into third place.
Clearly, Malaysia never had a comparative advantage in car manufacturing; so it was a huge mistake to embark on this venture, which has cost the public dearly.
But there is something else we should consider. Check out these two reports:
No more petrol or diesel cars, buses, or trucks will be sold anywhere in the world within eight years. The entire market for land transport will switch to electrification, leading to a collapse of oil prices and the demise of the petroleum industry as we have known it for a century.
(I am not so sure about the collapse in oil prices as China, India and other developing nations will guzzle even more oil as they race to reach the level of affluence in the West.)
The other report suggests people will eventually abandon individually owned cars and turn to ordering transport as a service. We are seeing the genesis of this shift now in the growing use of Uber, Grab and Grabshare.
RethinkX, an independent think tank that analyzes and forecasts disruptive technologies, has released an astonishing report predicting a far more rapid transition to EV/autonomous vehicles than experts are currently predicting. The report is based on an analysis of the so-called technology-adoption S-curve that describes the rapid uptake of truly disruptive technologies like smartphones and the internet. Additionally, the report addresses in detail the massive economic implications of this prediction across various sectors, including energy, transportation and manufacturing.
Rethinking Transportation 2020-2030 suggests that within 10 years of regulatory approval, by 2030, 95 percent of U.S. passenger miles traveled will be served by on-demand autonomous electric vehicles (AEVs). The primary driver of this unfathomably huge change in American life is economics: The cost savings of using transport-as-a-service (TaaS) providers will be so great that consumers will abandon individually owned vehicles. The report predicts that the cost of TaaS will save the average family $5600 annually, the equivalent of a 10 percent raise in salary. This, the report suggests, will lead to the biggest increase in consumer spending in history.
If these predictions are is true, then they have huge implications for our transport planning decades into the future.
For instance, the Penang transport masterplan is looking at six-lane highways (Pan Island Link) and eight-lane highways, even as population growth tapers off with declining fertility levels while more and more people are turning to TaaS.
Has the masterplan adequately studied the impact of this TaaS trend? Isn’t it foolish to plan expensive infrastructure so far into the future when technological advances could render it redundant or underused?
If TaaS grows and private car sales taper off, would that not afford us even more opportunity now for building dedicated bus and cycle lanes and pedestrian walkways?