Najib: Malaysia can become manufacturing hub for carmakers

By Eugene Mahalingam, The Star

Malaysia has the potential to become the manufacturing hub for global carmakers given the country’s ability to attract foreign investors and ease of doing business, Prime Minister Datuk Seri Najib Tun Razak said.

“The increasing entry rate of respected multinationals into the Malaysian market reflects the growing confidence that foreign investors have in our economy and investor policies,” he said at the signing ceremony of the collaboration and licence agreement between DRB-Hicom Bhd and Volkswagen AG (VW) yesterday.

Najib said under the National Automotive Policy, the Government provided a range of customised incentives, including tax relief, to entice foreign carmakers to move their operations to Malaysia.

“Our emphasis has been on attracting successful carmakers that utilise high value-added manufacturing techniques and the latest technology – companies like VW.

“We expect global players like VW to create a competitive fervour within the local automotive industry.

“This can push our capabilities to a new level and help us achieve our national objective of becoming an automotive hub for the region,” he added.

Under the collaboration and licence agreement, DRB-Hicom will produce VW vehicles at the former’s production plant in Pekan, Pahang, starting with the Jetta and Passat models, from the fourth quarter of 2011.

The models will initially be produced for the Malaysian market and subsequently for the Asean region.

Najib said by bringing together one of Europe’s best car manufacturers and Malaysia’s own automotive leader, such a venture could transform the country into a VW manufacturing hub for the region.