Automotive industry in Malaysia: an assessment of its development


New article by Peter Wad 


Title: Automotive industry in Malaysia: an assessment of its development

Authors: Peter Wad & V.G.R. Chandran Govindaraju

Journal: Int. J. Automotive Technology and Management, Vol. 11, No. 2, 2011

Abstract: This paper explains the evolution and assesses the development ofthe Malaysian automotive industry within the premise of infant industry andtrade protection framework as well as extended arguments of infant industryusing a global value chain perspective. The Malaysian automotive industryexpanded in terms of sales, production, employment and local content, butfailed in industrial upgrading and international competitiveness. The failurescan be attributed to (a) lack of political promotion for high challenge-highsupport environment, (b) low technological and marketing capabilities and (c)limited participation in the global value chain. Although the Malaysian infantindustry protection policy comprised many promising initiatives, the nationaland the overall domestic automobile industry ended up as a captive of theregionalised Japanese keiretsu system in automobile manufacturing. A newtransformation is required to push the industry beyond its current performancethrough a more strategic productive coalition with multiple stakeholdersincluding trade unions.


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