KUALA LUMPUR, Oct 22 — Ambition for a new “Asean Car” project involving Malaysia and Indonesia is unlikely to reach fruition owing to entrenched protectionism and self-interest of countries in the region, the Financial Times wrote today.

Writing in its Beyondbrics blog that focuses on emerging markets, the London daily cited business leaders as being concerned that the government-driven initiative will be mired in trade barriers and politics — issues that have perennially bogged down regional trade.

Pointing out that major automaking nations in the Asean bloc all recently established competing and divergent “national car” policies, the FT said these would likely stand in the way of an integrated vehicle programme spanning the zone, despite the attractiveness of the proposition.

“This vision is at odds with what was originally envisaged with the Asean auto market in the 1990s when Ford and General Motors first set up manufacturing in Thailand: a genuinely integrated Asean auto market where vehicles made in one country could freely be exported across the region,” it pointed out.

Ford and other carmakers began setting up facilities in Asean in preparation for the Asean Free Trade Area (AFTA) in the late 90s, but later cast their eyes elsewhere as this was repeatedly delayed and frustrated by non-tariff barriers erected by member nations eager to shield firms in their individual countries.

The FT also held up Malaysia’s first national car firm, Proton, as an example of the intricacies and obstacles that awaited an “Asean Car”, calling the automaker’s decades-long journey “the stuff of Asian automotive history”.

“Proton’s problems highlighted how it takes years – if not decades – of capital-intensive investment in manufacturing research and development, design, and building up sales and dealer networks to generate brand awareness, before a car company can stand on its own two feet.”

The return of the carmaker, now owned by DRB-Hicom, under the auspices of Tun Dr Mahathir Mohamad was also not a promising development, it added; the former Malaysian prime minister was the man behind Proton and who mooted the stillborn “Asean Car” idea.

According to the blog post, Proton during the Mahathir administration was nudged by pro-Malay affirmative action policies to prefer “less than efficient suppliers”, which consequently hobbled its competitiveness.

“Proton is now under the guidance of Mahathir, aged 89, as executive chairman. While, in fairness, Proton has made some waves locally with some snappy new models, no car company in history has been run successfully by the almost nonagenarian former prime minister of a country,” the FT wrote in the blog post.

The FT further explained that a regional car will face stiff competition from Japanese carmakers, which have an “unassailable lead” in Southeast Asian countries starting from Toyota’s first manufacturing in Thailand back in 1964.

In the past 40 years, Japanese carmakers have built up extensive networks of dealers, and those in Indonesia are loyal only to Toyota, Honda, and Nissan marques, it said.

“You have to have a good, competent, low-cost supplier base. Without that you can’t compete,” Singapore-based senior vice president for external affairs at Toyota Motor Asia Pacific, Hao Tien, told FT.

Yesterday, Prime Minister Datuk Seri Najib Razak announced a renewed effort on the “Asean car”, first mooted by Dr Mahathir in the 1980s to export Proton to Southeast Asia and beyond.

Najib said the project would be a dream come true as newly-appointed Indonesian President Joko Widodo, has expressed interest in pursuing the idea mooted by Malaysia, which will involve Proton.

The Association of Southeast Asian Nations (Asean) is the world’s fifth largest car market, just behind Brazil, with 3.5 million units sold last year, thanks to low level of private motorised transport coupled with increasing purchasing power by a growing middle class, and urbanisation.

Malaysia has the largest car ownership per capita number in the region with 336 vehicles per 1,000 people compared with 52 In Indonesia, according to consulting firm IHS Automotive.

While other Asean nations lag behind, they are predicted to undergo growing rates of car ownership, making them tempting targets for automakers.

The region is also expected to formalise the Asean Economic Community by 2016, which will ostensibly reduce further the trade barriers that still remain post-AFTA.