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    Malaysian Automotive Industry Analysis Essay

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    Proton Company Which makes Malaysia to be the tactics centre Of automobile industry in the area of Southeast Asia. Proton plays a vital role on automobile industry development inception. In this Mite up, the author Will investigate how proton automobile industry came to been and how the automotive industry in question became the cynosure in the African region most especially South African and Nigerian market. As according to market watch (201 1), it is only the coming up of integrated automotive industry will reduce the country’s over reliance on the agricultural sector (spare-mart. 2012).

    The rationale of this research is to study the importance of the Malaysian automobile export of spare parts to Nigerian market which if to be considered by its diversity, consumer preferences, and competitiveness in relation to South Korea automobiles brands and spare arts export market (MIDAIR 2009), The spare parts that this research work will focus more into the importation of the Malaysian automotive components and parts primarily within low-tech products like bumpers, steering wheels, wheels exhausts, rims, brake pads, bodies, shock absorbers, engine seat, compressors, radiators etc (proponents, 201 2), Keywords: Malaysian, Spare parts, Imports- Exports, Nigeria, Consumer Preferences. (source: proponents, 2012) Problem or Issue Identified. K Lack of proper background study between the exporting and importing countries. Example, not knowing much about customers as well as the value Of renounce that required the need of preliminary investigation about the two markets. * Most business collapse was as a result Of cost effective Which companies over spends together with inflationary rate. * Lack of mutual understanding between country’s businesses due to varying policies. 1. 2 Importance. In this write up, the author tried his utmost best the pinpoint the significance of this report as can be seen below; 1. This business research will enable the export of proton spare parts to Nigerian market as there is a demand of it.

    As Malaysian automotive was getting attention nowadays. 2. The research will as ell cerebrate opportunities to both the import and export countries. 3. To also investigate why the proton spare parts export was going down even during the economic year 1. 3 Proton’s Logo (Proton, 2012) I proton parts Organizational Chart, (source: proton parts, 201 2) (Source: provender’s, 2011) 2. 0 Research Questions. By earlier mentioning the stated problems above. The following research questions were listed down by the author: RSI What is the influence of parts shortage on Malaysian automotive export parts to Nigeria? ARQ_ What type Of automotive part is needed the most in Nigeria? ARQ.

    What policy should the two countries be laid on export trading? ARQ. HOW can logistics affect the exports trading in Nigerian automobile market? ARQ. At what cost or price should the product be reaching the consumer nation? 3. 0 Research Objectives and Framework. The broad objectives of this study are to examine the Malaysian automotive export of its spare parts to Nigeria and they will be serve as the elements to build the research model to find out how the variable relate. Thus the specific objectives are: 1. Parts shortage 2. Trade policy 3. Product needs (Market demand) 4. Cost effectiveness S. Logistics Mores, the research objectives are; ROI.

    To analyses the effects of parts shortage on the Nigerian market. ROR, To help explore how the automobile industries operate in both countries ROR. To state the inflationary figures through cost effectiveness of both countries. ROR. Help identity the logistics of the Malaysian automotive spare parts export industry to Nigeria. 3. 1 Research Model The designed model will illustrate how the dependent variable relies on the independent variables. The theoretical framework based on the studied factors can be viewed at the figure below. Independent Variables Dependent Variable Parts Shortage Parts Shortage Trade Policy Malaysia’s Automobile export Product Needs (Market Demand) Cost Effective Logistics 4. Literature Review: export of its spare parts to Nigeria for a broader understanding of the subject matter as they are will be elaborated further in below discussion after been listed the Objectives. Thus the specific objectives are: I _ Parts shortage 5. Logistics There also, the above objectives can be elaborated in following format as; 1. Parts Shortage: This is the greatest reason why most vehicle owner in Nigeria do to want to go for the Malaysian automobile because of the greater market share that some multinational automaker companies already has in the country. It is not long ago that Malaysian automobile was introduced into the country Nigeria.

    So many people were not very well familiar with the brand and the literature relating to development of automotive export of spare parts business to Nigerian market focused on service strategies (Gabbier, 2008). There is also branding or brand image, and brand identity plays as well a vital role in this aspect of marketing so as investment in which the Nigerian scared of losing their life paving to invest in Malaysian automotive brands, To cut it short, the reason why Malaysian automobile spare parts were short in the Nigerian market today was according to thorough research by the author was due to three reasons One is brand image and identity. Second is Investment. Third, product quality as well as the Nigerian poor state of roads connection.

    The below image, are the proton type products already available in the Nigerian market One can there also according to these made mention little are What contributed to the shortage of automobile spare parts in a country like Nigeria. Why this was said is that, the author research on the Malaysian automotive success and as well checking on it’s foreign success in one of the Africans leader when it comes to importing the country’s automotive products which is South Africa. The South Africa as a nation is the leader amongst the entire African continent and favors more of the Malaysian automobiles than any other country in the region or continent.

    Below image is the product sample that the Nigerian market needs in order to create more room for the Malaysian automobile industry to the Nigerian market. (tech, 2010) Proton in this aspect has set itself to venture in the Nigerian automotive market in order to compete with some other multinational automotive companies like Toyota, Honda, Peugeot, General Motors (GYM), Immunities, Ford, Renault, Hounded, Volkswagen amongst many other global automakers to help to the world in ease of transport. Branding is what most buyers if not all first think and go for when obtaining a particular product need arises So, this branding touches and intersects with all forms of businesses, be it operational, sales, marketing etc.

    However, conveying an image that is in sync with a viable brand strategy an not only help even the tiniest of companies but can be a major driver of its success. What branding sends to customers was to convey a unique value, increase brand recall and there also evolve With the company’s culture. The company in question was recently trying to create its branding in the country Nigeria. So, it Will take a While to create a strong brand Within the Nigerian automotive market that is why most spare parts were scarce in the country but thanks to major events that took place in Malaysia. One was its sound educational system and the second was the image it created itself in world racket. For instance, the South African automobile market which these will enormously help in sustaining more customers.

    The second point was the inadequate investors that will put in money to help the company go higher in the country because of their unfamiliarity with the brand. Lastly, was the Nigerian road were not compatible with that of Malaysia automobile due to their poor state of the country’s roads and also the Malaysian cars was not that durable and not too well know about the Nigerian demands (blob. Giants,2012). 2. Trade policy: Malaysian automotive industry was long been looked into from all cuisines angles especially by foreign competitors Malaysia’s car market has long been sheltered from foreign competition together with tariff as well as Nan-tariff measures, and that can be seen together with the automotive company of the country.

    The two giant automobile companies in Malaysia which is Proton and Periods conjointly mixed up in year 2008 to come with 62. 4% of vehicles sold (75. 2% in 2004 and 585% in 2005). Perhaps, these measures have resulted in the sector’s lack of international competitiveness, as total exports of motor vehicles accounted for only out of the total industry capacity. Nevertheless, most authorities in that sector most make sure that they maintain successes in taking 3 large share Of the domestic market (Mum et 31, 2008). The Malaysia’s National Automotive Policy, introduced in March 2006, aims to build a competitive automotive sector in Malaysia and promote exports products.

    The NAP committee was introduced in order to help assist the change needed and provide an ideal way to take the industry too higher level be it the local automotive industry into regional and then to the global industry networks within the increasingly liberalized and competitive global environment. The NAP could aid as one of the main driver for making change of this kind of strategic guidelines of the industry known to be under the Third Industrial Master Plan (IMP), 2006-2020. The Government is eager to take foreign investment within the automobile section, including 100% foreign equity to be allowed (Stephen, 2006). To obtain these aims or vision, the Government reduced border security for the automobile industry: in the month to March 2006, import processes was reduced to for a whole built-up (CUBIC) vehicles (from 3550%), and remained at for complete knocked-down (CD) vehicles (MIT. Gob, 2012).

    Under Insignia’s Customs Legislation as well as the Ministry if Finance which created home finance department just for the purpose of import prohibition and nearly full protection of domestic industries; to reduce balance of payments deficits; as anti- dumping measures; in addition to moral safety and other processes (WTFO, 2012). The Government normally from time to time amend policies pertaining to import prohibition list, thereby adding or subtracting some items in the list, through notices and decrees. Nigeria assured other duties and charges on all imports curved at 80%. Additional duties applying only to imports include: a port development levy Of Of the duties payable; an SHOWCASE community levy of 0. 5%; a Comprehensive Import Supervision Scheme charge Of 1% on the f. o. B. Alee Of imports, a national automotive council levy Of on vehicles and parts in which all these were taxes that will make import of such components more costly (supersonically, 2012). According to a report from Punch Nigeria Newspaper, saying that the Ministry of Trade and Investment which there is a meeting been held early this year as according to its Minister Chief Loosening Gang which quoted as new policy will be revealed soon by the Federal Government on new national automobile which will assist transpose the automotive industry and make better its contribution to the national Gross Domestic Product which hold responsible for all trade-related matters (punching, 201 2), These make it to be the preferred trade policy formulation as well as its implementation on multilateral and bilateral agreements.

    As most organizations have departments so as the government Ministry as well as the Department of of External Trade; Domestic_ Trade: Commodities and Export Trade; and there also the Commercial Law (Cabbage, 2005). In other government Ministries like that f the Ministry of Commerce which however, have several other line Ministries, whose also uses the trade formulation policy and implementation in order to generate revenue. For instance, the Nigerian National Petroleum Corporation (NP) which is same as Federal Ministry of Petroleum Resources in some other countries also formulate and implement their own policy matters which resemble with that of other Ministry function when it comes to market section. Even so, share of responsibility for international trade stick to be the same or similar function With that Of Other Ministry (Rerun, 2004). 3.

    Product Needs (Market Demand): In here, there is a huge product needs or market demand in order to facilitate the business existence or flow Of proton in Nigeria. There a quiet large amount of Malaysia automobiles recently imported into the Nigerian territory but scarce enough spare parts to enable ease of maintenance of the vehicles. So, many customers will which the spare parts will be within their reach especially when there is a vehicle on the road broke down as result of the country’s (Nigerian) poor state of roads. 4 Cost Effective: During Malaysia era of pre globalization development. The automotive industries were considered to be like the “mother of all other operating company’.

    Many have been researched on its potential toward achieving nation’s industrialist successes due to it spill- over effect on other industries of the same level of manufacturing (Dickens, 2007), Because, the dynamic nature as well as the economic_ function(s) seems to be primarily the same which determined this action by the country’s customs which in one way they may follow the policy intervention in favor of the automobile manufacturing infant industry, especially to those countries lagging behind, The African countries for example. In most countries, this cost effectiveness this favor or support will make the combination of both import protection policies against maybe other foreign automobile investors. Industrialization of developing countries therefore often meant De-internationalization of the specific industries considered (Wad, 2011). So, when looking at both market, it will be costly the product to reach Nigeria especially when compare at the rate of receiving other existing brands like Toyota, Honda etc.

    But the most important thing here is that, since there could be buyers Of not only one vehicle but in elk definitely there can be buyers as well of its spare parts. It is also important to figure out each country’s inflationary rate or figure so as to make a clearer understand of the spare parts export business. Firstly, the Malaysian inflationary figures is to be stated first followed by the importing country (Nigeria). (proponents, 2012) Malaysia’s Inflationary rate (transmogrification, 2012) From the stated chart above, one can figure out that the inflationary rate recorded in Malaysia in October this year was at 1. 70%. And this figure analysis was quoted from the national Department of Statistics Malaysia.

    There also, history indicates that since from year 2005 till this current year 2012, the Malaysia’s rate of inflation was averaged at 2. 66% which was reaching at a peak of 8. 50% in year 2008 and going down as low as -2. 40% a year after. The figure also indicates that, inflation measures a broad rise or fall of prices which buyers are willing to obtain a particular standard of goods or services (tragicomedies, 2012). Insignia’s Inflationary rate (tragicomedies, 2012) October 2012 was the year when the Insignia’s inflationary rate recorded at 1 1. 70%. This figured was reported by the country’s Central Bank (CAB). And satirically, from 2006 till this year, Nigerian inflationary figures was averaged at 10. 6% becoming at its peak of 15. % in year 2010 and with a record low of 3. 0% in previous years (2006). It is as same with Malaysian consumer taste and preferences where the inflation figures measures a broader increase or decrease in prices that buyers pay for a particular standard set of goods or services (traditionalistic, 201 2), 5. Logistics: Here the term can broadly be defined as the management of a supply chain processes. It comprises many interrelated and interactive events or activities covering a vast on procurement, distribution s well as production. It is concerned with the physical and information flows from raw material through finished goods (Salina, 2004).

    The widely been used definition is the one by Council of Logistics Management which quoted as: “Logistics is the process of planning implementing and controlling the efficient, effective flow and storage of raw material, in-process inventory, finished goods or services as well as related information from point of origin to point of consumption for the purpose of conforming to consumer requirements% In this study of Malaysian automobile export of spare parts to Nigeria can be one through contract logistics, which is a contractual agreement to provide logistics service to Nigerian customers in term of this study (Spare parts exports to Nigeria).

    So, normally in this type of contract agreement (term), any services lured and consideration most be defined within the agreed parties of Nigeria and Malaysia Which there can also be done after making every necessary agreement through sea method of transportation which inexpensive by the time the components Will be arriving the imported country. (presentational. 2012) Table 1: Vehicle production in Malaysia indices Source: Malaysia Automotive Association, 2012) 5. 0 Research Methodology And Design First thing first. Will like to briefly define what is mean by research, research methodology and then the design for a broader understanding of the topic discussion. As according to Sahara (2012) which he sees research as a voyage: A journey; An attitude; Also a method of critical thinking; A careful enquiry in seeking facts for principles.

    There also he as well defined research methodology; “Research methodology refers to the technique, procedure and measures that have been adopted to study a particular population, tools, research instrument estimate”. (Thomas, 2003). “As the science of studying how a particular research is been conducted scientifically. A methodology that helps to understand not only the products Of scientific inquiry but the process of data collection itself’. (Sahara, 2012). There also, in order to research a methodology, there are numerous types and approaches which can be implemented for a better outcome depending on the nature or type of the research purpose. 5. Concept In using concept of research the area of interest is first to be considered make it a focal point which will then be elaborated in detail After the topic has been cited, the next concept step is to come up with a research question (ARQ), In the process of research, it normally begins with the activity of reaching a clear statement related to the research question, The research questions is then known to be a statement of what the researcher have attained through learning and studying which will he completed at the end of the research, gay revising the research questions, it is known to be a good practice which will make sure that the writer or the one who authored the article or journal is clear on what he/she or they intends to know. 5. 2 Research Types. Basically, Research Methodology could further be classified into two types which are Qualitative and Quantitative Methods as per as this particular given research assignment is concern. Qualitative methods mostly deals with description of facts, problems and issues while quantitative method deals with gathered numerical data. In short, these Research Methodologies will be explained in detail as below (Crewel, 2006). 1. Descriptive Quantitative Research: This type Of a research helps measure things as they are be it through frequency or average description. Example, how many people are participating in his program? 2.

    Descriptive Qualitative Research: Which have a detailed description of a particular situation(s) with the aid of using observations, document sampling or review, and interview. In this case the author Will describe things as they are. Example, people’s perception, or how do people implement this program? 5. 3 Research Design: The researcher in his utmost best stood well in order to make the research result up to standard followed a duly preceding through actual data collection and many reviews in relation to the topic was conducted to study contributions room other researchers to Malaysian export automotive spare parts to Nigeria. In this research design type, qualitative design was employed in order to make it more meaningful.

    Thomas and Corbett (2003), differentiate qualitative and quantitative research type as; “As a qualitative study, the activities of collecting and analyzing data, then developing it and amend possible theories thereby elaborating or refocusing a particular research question, and identifying and dealing with validity. Furthermore, the researcher may need also to modify or reconsider some design session during the study in response to development or changes in some many other respect of the design. ” (Thomas and Corbett, 2003). 5. 4 Data Gathering Method Many sound quality researchers mainly concerned With validity rather that What is known as factual predictions of their communication in order to decrease the likelihood Of misinterpretation, through procedures Which may have include data redundancy collection as well as procedural challenges in their explanation to the particular study they make or about to be conducted.

    There are Of course various other data gathering in qualitative research methods which amongst ere: interview, summation focus group, document review, observation as well as critical reports in incident. But, in here of this particular research, the document review is the one type used for this research wince various literature reviews were the only method referred in order to come up with such amazing research on this particular chosen topic (Dentin, Lincoln, 2005). And one can define document review as a research method that requires the researchers with in-depth learning process, so as to enable a critical text editor, such as media reports, diaries, journals, articles or blobs. The researcher should explain the method used and readers should feel at home that the method involved a critical approach.

    Importantly, the whole entire of this research was conducted through websites as well as journals and articles (Dentin : Lincoln, 2005). 6. 0 Ethical Consideration In this given research conducted so far there is no harmful effect carried out or stated through the entire piece of the research finding an was in a compliance with both state as well as a federal law from both exporting country (Malaysia) and the importing country (Nigeria). Furthermore, this founding can be printed, edited for revise, redistributed or viewed by others most especially the automotive industries in the country as well as foreign investors alike. But, as this case is concern, the founding was solely been used for academic purpose.

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