Neutralizing the Proton

One of the cool things about living in Asia is getting to see models of cars that aren't sold in The States. In fact, not only do I see unfamiliar models, sometimes I encounter entire car companies I’ve never heard of.

In Malaysia, I started to see Proton cars. A lot of them, actually.

In 1983, Malaysia’s long-term Prime Minister, Dr. Mahathir Mohamad decided that rather than importing other countries’ cars, Malaysia should produce its own car. With a little technological help from Mitsubishi, the first Proton hit the streets of Malaysia in 1985. In just three years, the Proton car had managed to capture over 70% of the Malaysia car market.

But it wasn’t all just national pride. To ensure the success of its first national car, the government slapped steep tariffs on imports and simultaneously offered rebates and tax breaks for the Proton. The result was that the Proton was priced 30-60% cheaper than comparable imports. No wonder they cornered 70% of the market. Since then, the ASEAN Free Trade Agreement -of which Malaysia is now a member- stipulates that as of 2008, large trade barriers like tariffs and preferential discounts are not permissible. The tariffs are now down to 5% and Proton’s market share has dropped to just 30%.

So much for national pride.

But at least they still have that cool stylized tiger in its logo.