“It should be a level playing field” – MAA on increasing market dominance by Proton and Perodua in Malaysia

National brands Proton and Perodua both had a stellar year in 2020, increasing their combined market share to 62.1% (highest since 2003) out of the total industry volume of 529,434 units. This was propped up by continued strong sales by market leader Perodua (41.6% market share in 2020) and the continued revival of Proton (20.5%).

While that may be good news for Proton and Perodua, it also means that all the non-national brands in Malaysia are now playing for the little leagues, sharing less than 38% of the pie. That’s a far cry from their glory days of between 2014 and 2018, when Malaysians bought more new non-national vehicles than either Protons or Peroduas.

Although the current dominance isn’t quite as prominent as the early 2000s, when the two national carmakers cornered around 80% of the market, the trend should be worrying foreign brands, especially those that have placed significant investments in the country. We posed this question to the Malaysian Automotive Association (MAA) at an official press conference earlier today.

“We feel [the Malaysian automotive market] should be a level playing field, so that both national and non-national players have the same ability to compete in the market. There are more policies to ensure car companies can attract more investment, whether they are national or non-national brands,” said Datuk Aishah Ahmad, president of the MAA.

Officially, there are no longer any specific protectionism policies in place to spur on national brands in Malaysia (as there have been in the past). However, the current taxation system still heavily favours both Proton and Perodua, as they obviously have more investment, R&D and involvement in the country’s automotive industry ecosystem as a whole, giving them access to more incentives and/or tax-cuts from the government.

Over to you – what do you think of this evolving situation, and how should we approach this sensitive subject, if it is indeed an issue at all?

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