The so-called `national car' manufacturer Proton has reached the crossroads. It was reported in The Edge recently that Proton car sales have declined by about 25 percent in the first six months of 2003 compared to the same period last year.

For the first time in its history, the statistics do not favour Proton.

With the Asean Free Trade Agreement (Afta) set to commence in 2005 (for the automobile industry) and the fact that Malaysian government has no choice but to gradually relax some of its policies on pricing, it doesn't take a genius to explain why Proton car sales are sliding.

The citing of Sars and the Iraq war as the reasons for the decline are certainly laughable.

With poor designs, outdated models, sub-standard quality of finishing and safety, poor after-sales service and high prices (considering that they are produced locally), it is clear that Proton will find it hard to compete when Afta comes into effect.

Proton is very much Prime Minister Dr Mahathir Mohamad's pet project. The `national car' project commenced shortly after he took office in 1981. The first car was rolled out in 1984.

With media on the government side, the whole rakyat was told (or conned?) how great the Proton cars were, designed by `anak Malaysia' for Malaysians. But we all know that they are nothing but mere facelift from Japan's Mitsubishi models.

I was in my teens when I first saw the first Proton car and, of course, was very proud of it. In fact, I used to dream of owning one, which years later become a reality (and misery).

However, like many others, I did not buy Proton for the love of it or to prove my patriotism. I was left with little choice as foreign cars are discriminated against in terms of pricing in order to boost Proton sales. What a superb marketing strategy!

Now that pricing policies have to be relaxed, foreign car models such as from Honda, Toyota, Hyundai and Kia are sold at more competitive prices.

It was reported that the sales of all Toyota models increased by 74 per cent during the same period, while Honda currently has 10,000 customers on the waiting list for its latest model. What do these figures indicate? Obviously, it shows that Malaysians are bored with Proton's ancient models since the so-called `national cars' are nowhere behind their foreign competitors.

While foreign manufacturers come up with new models every year, Proton can hardly do the same. It is sad to note that Proton is still clinging on its 1980s model (Proton Saga Aeroback) through a series of face lifts.

Currently, Malaysians still have to fork out extra ringgit if they wish to own foreign cars, although the difference is narowing. Just as when Toyota and Honda cut their profit margin and sold their models for some RM10,000 extra compared to Proton, Malaysians are already showing a craving to own these.

Imagine the disaster waiting to happen when foreign cars are allowed to compete on a level playing ground.

Time and again, our leaders tell us how great Proton models are, and how brilliant the local designers. We have been shown how great a Proton car is - it didn't even get a dent when dropped over the North Pole. What a boleh thing!

But reality is not that sweet for Proton. After almost two decades, the `Malaysian' cars still have to rely on Japanese engines although it is said the locally made engine is underway. Believe me, when the Campro engine comes out, people will chose the proven engine rather than the unproven one.

Proton's export figures are nothing to be proud of as the volume is almost negligible, although there is a long list of countries where its cars are exported. Worse, Proton has yet to roam the US streets. The rule of thumb is, if the product is accepted in the US, it will be accepted worldwide.

It interesting to note how Korean-made cars such as Hyundai and Kia are now becoming best selling models in the US, where the market for cars are highly competitive and standard is high. In fact, Korean cars were born at around the same time as Proton. What can Proton learn from this?

Like it or not, Proton's days are numbered. With trade liberalisation already at our backyard, Mahathir's brainchild can no longer depend on the government's protective policy. In fact, quality, price and customer satisfaction will determine the fate of every product and service in the age of open trade.

This makes me wonder whether, in the first place, Proton was born to cater for the need of the rakyat (though sold at three times higher than the per capita income) or to provide political mileage for politicians.

If the latter is the reason for its existence, then we know it well that Proton is heading for extinction sooner or later.

Unless there is dramatic improvement to win the Malaysian and foreign markets, Proton is likely to quit along with Mahathir. Buckle up, Proton!