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Saturday, May 14, 2011

World Car Sales Increase Significance

This morning, I was reading The Edge Singapore writter Assif Shameen comparing the car growth rate in China in 2008 and a "merely 2.8% y-o-y in April" 2011. The report was lamenting the demise of Detroit car industry during climax of the 2008 American Financial Crisis (yes American!). Then the next paragraph was in praise of current growth of 18%.

The fact is these countries, economists, US government, China, Malaysia, trade executives, keep thinking of car sales as a measure of men, or measure of economic growth, superiority, luxury, attainment and more. And reports after reports, seem to back it up so the mere mortals are reading and nodding in agreement, and thinking of ways to buy the next marketed model of Peugeot (because it is trendy now since being declared the top Continental Car Sold for 2010), or trying to outdo the neighbour's Mercedes or the insurance agent's old Volvo - knowingly the 20 year old Volvo's air conditioning has worked for 3 years and the steel cage is just a "fear factor" or "success show piece" to sparkle the eyes of potential insurance sales cash lambs.

Car or vehicle ownership is wrongly matched with economic growth and health benefits. If we extrapolate car ownership to its maximum goal - every citizen in China owns a car. 1.5 billion cars! On and off the road? What is the significance? Even at 50% ownership or say even 30%, it is a catastrophe.

Malaysia's sanctioned policy of masking taxation by populating car ownership funnelled to monopolised constructors and Approved Permits holders (virtually a license to be a monopoly) is a clear example of channelling or focusing on ownership too much, while neglecting the actual meaning of transportation - bringing efficiency, comfort, safety to the citizen's commute time and means - whereby it will be returned as productivity and better health that in turn contributes to the country's coffers, goodwill, and more.

If the billions of money that was spent to create the car ownership industry be put into real transportation needs, taking away the notion and suggestion of car ownership as a measure of success, the citizenry can focus on productivity, lifestyle, culture, health and exercise, home ownership.

A great example is South Korea. Seoul itself has several hundred train stations to serve the commuters. Switzerland too. A typical day in Zurich is waking up, having breakfast, walk 200 metres to the train station, train arrives on the dot at 8:43 AM, brings you to your destination at 8:53 AM, you spend another 5 minutes walk to your office, and 8:58 AM, you're 2 minutes early for work!

What was taken away? 2 hours off the seat of a "lifestyle promising triumphant glory" of a car. In fact, most Swiss would have spent that 1-2 hours in the morning walking their dogs, have a jog around the lakeside pavements, or cycling around the block. A great morning exercise and still have time for some muesli breakfast plus washing the dishes and that Javanese coffee pot.

In Malaysia, alas, this is what the commuters get. 1-2 hours of elevated stress. Twice. Daily. Accumulate that for 5 years, 15 years, it will end up with a unhappily formed stress outcome - high blood pressure, loss of hair, internal organs beginning to get clogged, and perhaps more serious bad health issues. Well the media paints it straight. It is "normal". The colleagues, the people. All have seem to "accept this fact of life". Much as we are told to accept that corruption, Approved Permits are a given and there is nothing you can do about it.

Even taking away all the philosophical and health components and just dwell at the financial outlay.
There is: PETROL - 50-100 RM per week
Maintenance - cost varies.
Safety and Security - Locking Systems, UV Protection, Insurance (theft, terrible driving that has been on the growth path as well as car ownership growth path that gives a higher chance of accidents and potential medical expense.)
Car Loan. 500-1000 RM per month.
Bonus: Recently there is a trend of robbery using the modus operandi of breaking the front passenger seat window to steal the handbag of the car driver.
At minimum (for living in the city) cost of car ownership is at least a thousand ringgit. The Swedish have to pay a supposedly higher tax of perhaps that sum, but in return they will get superior transport system that takes away the accompanying health issues. And the bonus for them is their health system is totally covered. There is zero fees for hospitalisation and seeking medical treatment. This is the other cost in car ownership that we often couldn't see because it was written so we can't see it.

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