A million clouds on the horizon?

by **Cals** Sun 15 Nov 2015, 02:34

A million clouds on the horizon?

BY ALAN TONG - FOOD FOR THOUGHT

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LAST week, my team members were late for a discussion after they were trapped in the traffic for more than half an hour near our office, and they profusely apologised for being late. I looked at them and smiled instead as I totally understood the situation that they had just been through.
I believe most of us have been caught in a terrible jam before despite allocating time for slow traffic.
I have even heard that some people spend up to four hours a day travelling from their homes to their offices and back! If you think KL is congested now, it is going to be more congested in the near future as Malaysia’s car sales target is going to increase from about 660,000 in 2014 to one million in 2020.
It was a surprise to me when I read about the car sales target in one of the newspaper recently.
The Malaysian Automotive Association (MAA) thinks the car industry can achieve a total industry volume (TIV) of one million units by 2020 set by the government, if the right economic fundamentals and proper incentives are in place.
Our car sales volume has been growing for the past few years. The number of new passenger and commercial vehicles hit 666,465 in 2014.
Traffic conditions are getting more challenging day by day with more cars added to our roads, not forgetting the millions of old/existing cars that we are now driving.
The one million car sales target may create another cloud on the horizon. It is puzzling to have such a goal when we should be encouraging the rakyat to use mass public transport with the upcoming Mass Rapid Transit (MRT) lines, more so when there are limitations in widening our existing roads.
I wonder how our roads are going to cope with more new cars being released onto the roads, and there would also be more headache with cars parked at the roadside especially in residential areas.
With a higher car sales volume, it means more time will be spent on travelling. The rakyat will have lower mobility and efficiency, and all this will add more costs to our daily living.
According to a report from the web, the sales of passenger vehicles (552,189 units)alone reached RM74.85bil in 2012, indicating that the median price of each car was at around RM135,000.
Assuming we take RM100,000 as the median price, our nation as a whole is expected to spend RM100bil per year in 2020 alone if the car sales volume hit one million by then.
Ten years later, the value of this RM100bil per year may depreciate to only 10% or RM10bil if we apply a 10% annual depreciation as practised in accounting or car insurance calculation.
I believe there are better ways of spending this huge amount of money.
For example, the RM100bil car sales a year is sufficient to build four MRT lines similar to the size of the Sungai Buloh – Kajang line, which costs about RM23bil and can serve a population of 1.2 million people!
Imagine the immense economic contribution and investment returns the nation can enjoy if only we have a magic formula to re-channel the RM100bil in car sales to build our public transportation system.
This will benefit us for many generations to come instead of writing-off the money spent on cars every year due to depreciation. The world’s oldest rapid transit system, The London Underground, is a good example. It has been serving people for more than 150 years!
In addition to the cost of purchasing a car, there are also many other financial commitments to owning a car. These include petrol, parking and toll charges, maintenance and repair costs.
With the rising cost of living, there are uncertainties in allocating money for all these items, and it puts stress on our household expenses.
When the rakyat don’t have sufficient access to integrated public transportation, a private car becomes a necessity in our daily lives even though it is a depreciating asset and consumes a big portion of our household budget.
While it is gratifying to see that the government has realised the importance of public transportation, and has started working on massive infrastructure projects such as MRT and LRT lines for the last few years, there is still room for improvement.
It is important for the government to expedite infrastructure projects, consider adding more MRT lines, and develop a comprehensive public transport system by adding feeder mini buses and buses in cities and suburban areas, to encourage the rakyat to travel using public transport without depending on private vehicles.
Given a choice between a city congested with cars with its accompanying pollution, and a city that has a comprehensive public transportation system, which will be a world class city and which will be a city you would like to live in?
I always admire cities such as Shanghai, Hong Kong and Singapore, where their people can fully rely on their public transportation to be on time for their appointments.
How I wish Malaysians can do the same one day, instead of adding one million new cars every year, which our roads and pockets can’t afford.
Datuk Alan Tong has over 50 years of experience in property development. He was the World President of FIABCI International for 2005/2006 and awarded the Property Man of the Year 2010 at FIABCI Malaysia Property Award. He is also the group chairman of Bukit Kiara Properties. For feedback, please email feedback@fiabci-asiapacific.com.

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