Thursday, 31 December 2015

Expect more competitive environment as new investments set in

Malaysia's automotive sector is set for an exciting 2016, after a stable performance this year. Although the appreciation of the US dollar against the ringgit resulted in consumers being more cautious in their car purchases, it is interesting to note that the Goods and Services Tax impacted the industry somewhat positively, as oiginal equipment manufacturers (OEMs) either reduced or maintained their prices from April onwards.
The automotive industry is expected to see a more competitive environment next year as new investments under the National Automotive Policy 2014 (NAP) set in, resulting in not just a higher production volume but also added-value to the automotive workforce, business owners, technology developers as well as the consumer.
Employment Opportunities and Career Enhancement in the Automotive Sector
The Malaysian Automotive Human Capital Development Roadmap (MAHCR) will further meet the ever-growing demands of the Malaysian automotive industry, which is constantly evolving in product complexity and process efficiency.
The roadmap focuses on two paths – meeting the immediate needs of the automotive industry and preparing for the future requirements of the industry. The manufacturing and after-sales sectors require a skilled workforce capable of product and process design, with quality cost and delivery in mind.
As of this year, Malaysia Automotive Institute (MAI) Human Capital Development programmes have created 14,319 new jobs through numerous efforts, such as Automotive Industry Certified Engineer (AICE), Industry Led Professional Certificate (IPC) and Apprenticeship programs. When combined with direct recruitment by the industry, the total of new jobs created is estimated at 23,000.
MAI has formulated a plan to create 25,000 new jobs in the automotive sector under the 2016 Budget.
The plan also comprises training for 10,000 existing workers, enhancing the competitiveness of more than 100 local vendors, upgrading 2,500 existing workshops and developing new entrepreneurs in sales, distribution, services, repair, manufacturing, remanufacturing and recycling.
The plan is in line with the NAP's core thrusts, including creating new jobs and entrepreneurs, career enhancement and improving existing businesses.
Creativity and Innovation requires Conducive and Collaborative Engineering infrastructure
As the NAP 2014’s 2020 target looms closer, it is important that the industry’s technological edge is strengthened in the key areas of engineering design, prototyping, product validation and process development.
The global automotive ecosystem has created the need for shorter and cost-effective product development cycles, and our local industry is not spared from the need to cope with this trend in order to remain competitive.
As technology acquisition is a challenge for the local community, MAI has embarked on the implementation of the MAI Intelligent Technology Solution (MITS). MITS is an ambitious project that will comprise an integrated technology solution for both the manufacturing and after-sales sectors, from product conceptualisation to vehicle after-sales support.
In the area of product and process development, the Design Engineering and Prototyping (DEP) programme will provide a platform through shared facilities of software and hardware to utilise the entire automotive community’s expertise in design and analysis. DEP has so far benefitted more than 100 parts and components manufacturers (vendors) and vehicle manufacturers like Perodua, Proton, GoAuto and others.

The after-sales sector will receive a technological boost through the implementation of two after-sales solutions, plugged into the MITS system.
These two solutions, namely MAI Garage Information System (MAGIS) and CarBengkel, will provide service centres, spare parts distributors and consumers with a single interface to meet their after-sales needs.
As we approach the age of Internet of Things (IoT) and Big Data, MITS will serve as a productive and cost-effective solution for OEMs and vendors to enhance the value creation process of the local automotive industry.

Thursday, 24 December 2015

Skills development ensures industry's competitiveness

Low oil price, USA interest rate issues and China recent lower growth rate have impacted the global economy for 2015 and the scenario seem to be continuing into 2016.
The current demand by the British government for the European Union (EU) to reform with a threat of the country resorting a referendum to leave the EU should the Union fail to adhere to proposed reform. The referendum may affect European economyand this may further impacted the global economy should the referendum proceeds next year and in favour British withdrawal from the EU.
While economic recovery seems promising in the USA, economic uncertainties in the other global economic influential nations such as China and the UK may prolong the global economic stagnation come 2016.
Although Malaysia is foreseen to be able to at least maintain its growth, the possible gloomy global economic scenario next year will in one way or another affect the nation’s economic performance.
Manufacturing sector, particularly automotive, may face a greater challenge should economic sluggishness took its shape in 2016. In this respect most advance countries will take a proactive initiatives to enhance the competitiveness of their industries in preparation for the forthcoming economic recovery.
The government recent RMK 11 announcement has given a higher emphasis on human capital development in the next five years plan is a move in the right direction. An allocation of RM1 billion in the next five years for the Skill Development Fund will enable the incoming younger workforce to receive skills and vocational education.
Malaysia Automotive Institute (MAI) has been active in providing bridging training programmes for newly graduated younger workforce to prepare them to enter the automotive sector. Programmes such as; “Automotive Industry Certification Engineering (AICE)” for university graduates, “Automotive Industry Graduate Apprenticeship” for university new intakes, and Industry Led Professional Certificate (IPC) skill training institutions graduates, are constantly pursued.
While Human capital Development initiatives are being intensified, automotive vendors quality enhancement programme were also implemented and will be continued into 2016.
“Automotive Supplier Excellence Programme (ASEP) is one of those programmes implemented to provide a structured framework for on-going improvement of the local vendors. The programme benchmarks the local vendors against one another and the best-in-class international companies in order to establish their respective level of competitiveness.
Another quality assurance management programme that have been aggressively implemented by the local vendors is the “Lean Production System (LPS)” to inculcate work cultures amongst vendors acceptable to the OEMs.
The concept of “interchangeability” of mating parts in components assembly developed in 1913 marked the beginning of mass production of automobile by Ford in the USA. The assembly and parts manufacturing has since evolved and various quality systems and practices were developed and introduced on the production line.
Toyota on the other hand introduced the “Toyota Production System” in 1930 to ensure its quality production is sustainable and has since became the leading lean exemplar in the world of automotive quality manufacturing.
Since 2011 MAI has help to develop the LPS practices amongst the local automotive industries and to date some 108 companies are now practicing LPS diligently to ensure their quality outputs.
Intensification of the LPS practices and LPS skill development amongst automotive workforce is crucial to further enhance the industry competitiveness. Further the concept of LPS must be introduce at the early stage of learning amongst the forthcoming automotive workers.
In this respect, while the nation economic uncertainty may prolonged into 2016 and beyond, aggressive training and education in the concept of LPS should be the focus by the automotive community in preparation for the forthcoming economic recovery.

Thursday, 17 December 2015

Automotive industry likely to see holistic growth this year

Malaysia's automotive sector is set to be an exciting year in 2016, after a stable performance in 2015. Although the appreciation of the USD resulted in consumers being more cautious in their car purchases, it is interesting that the GST implementation impacted the industry somewhat positively, as OEMs either reduced or maintained their prices from April onwards.
The automotive industry is expected to see a more competitive environment next year, as new investments under the NAP 2014 set in, resulting in not just a higher production volume, but added local value to the automotive workforce, business owners, technology developers as well as the consumer.
Employment Opportunities and Career Enhancement in the Automotive Sector
The Malaysian Automotive Human Capital Development Roadmap (MAHCR) will further meet the ever growing demands of the Malaysian automotive industry, which is constantly evolving in product complexity and process efficiency.
MAI has formulated a plan to create 25,000 new jobs in the automotive sector under the Budget 2016.
The plan also comprises training for 10,000 existing workers, enhancing the competitiveness of over 100 local vendors, upgrading 2,500 existing workshops, and developing new entrepreneurs in sales, distribution, services, repair, manufacturing, remanufacturing and recycling.
Creativity & Innovation requires Conducive and Collaborative Engineering infrastructure
As the NAP 2014’s year 2020 target looms closer, it is important that the industry’s technological edge is strengthened, in the key areas of engineering design, prototyping, product validation and process development.
MAI has embarked to implement the MAI Intelligent Technology Solution (MITS) to boost the capabilities of local vendors. This is an ambitious project that will comprise an integrated technology solution for both the manufacturing and after sales sector, from product conceptualization to vehicle aftersales support.
MITS will boost local product and process development through the Design Engineering & Prototyping (DEP) program, a collaborative platform that utilizes the automotive community’s expertise in design and analysis.
The after sales sector will be enhanced through the MAI Garage Information System (MAGIS) and CarBengkel applications. This will provide service centres, spare part distributors and consumers with a single interface to meet their after sales needs.
Bringing EEV awareness directly to consumers - Bigger role for MAI at Asean Autoshow
MAI has been involved in the ASEAN Autoshow (previously known as the NST Autoshow) since 2013, and we aim to elevate the quality and excitement of the autoshow by bringing in future trends, technologies and models, with a special focus on Energy Efficient Vehicles (EEV).
This will allow the local automotive community to gain direct exposure to the global automotive ecosystem on an annual basis.
Is now the best time to consider buying a car?
Since the NAP 2014 was announced, the automotive industry has seen an unprecedented level of consumer choices in car purchases. The industry saw an accumulated average reduction in car prices of 16 percent by the end of last year.
Although the momentum of this price reduction was impacted recently due the appreciation of the US Dollar, it is undeniable that the environment of car sales has changed to the benefit of the consumer.
We have seen competition among car makers through the numerous promotions given to the consumers in last year and this year, we expect next year to be no different.
Despite possible price hikes next year, the government does not control car prices, and carmakers are free to raise or reduce their prices to fit their business plans.
Nevertheless, consumers should not base their purchasing decision only upon speculation, but rather on the need for a new car.
It is best to also weigh in the indirect losses incurred from delaying their purchases, such as maintenance of their old car and used car depreciation.
They should also take advantage of promotions available in the current time period.
2016 – what can we expect?
The Total Industry Volume (TIV) for this year is expected to reach between 640,000 to 660,000 units by the end of this month. This indicates that the industry has managed to remain stable despite the challenging global economic climate.

It is important to note that the Total Production Volume (TPV) has shown a significant October year-to-date performance from last year.
TPV, which measures industry performance in terms of units produced domestically (TIV is a measurement of domestic sales) is an important measurement of domestic value added to the industry.

As mentioned, there has been much traction from local players to strengthen their in-house capabilities in product design, manufacturing and after sales. At the same time, we are pleased to report that a few OEMs are expected to begin their export programmes next year.
These export initiatives are expected to boost domestic production next year. MAI’s forecast for next year is a TIV of 680,000 to 700,000 and a TPV of 600,000 to 620,000.

Thursday, 10 December 2015

ASEP helps vendors maximise global competitiveness

Automotive parts and components manufacturers compete on a set of criteria to the satisfaction of their customers and some of the more critical ones are; cost or selling price, quality, logistic, responsive and R&D capabilities.
Quality and logistics are important criteria for most OEMs when assessing their vendors. Evaluation of quality will be much dependent on the quality systems, such as ISO/TS16949, being adopted. In addition the capability of a vendor in terms of quality is often assessed on the amount of rejects attained on delivery and the amount of rework undertaken within a defined volume produced.
Although the quantum of rejects and rework may vary from process to process, a world class vendors are considered to be in the order of 200 parts-per-million (ppm) in their rejects on delivery and 1.2 per cents parts are reworked. Quantity of rejects prior to delivery, or scrap, has also been taken into account to reflect the capability of the vendors.
R&D capability provides a clear indication of the personnel intellectual capacity within the vendor’s manpower structure which renders high confidence in the OEMs to procure their required parts from the vendor.
Above all the true benchmark adopted by most OEMs in selecting their suppliers is cost, and the cost competition is severe in any procurement exercises.
To enter the regional or global supply chain, it is necessary for the local vendors to ascertain their level of competitiveness through a benchmarking exercise against world class manufacturers. In this respect Malaysia Automotive Institute has taken the initiative to implement a programme known as “Automotive Supplier Excellence Programme”, or ASEP.
The Programme aims to assist the Malaysian automotive supply base to establish their levels of competitiveness through an established competency assessment framework. Thereon prioritised series of improvement projects are planned and implemented to raise the vendors’ capability to a globally competitive standard.
These aims are pursued through a three-stage process to ensure the use of limited resources in achieving maximum benefit for the vendors.
Stage 1 of the programme is to define the vendors’ performance criteria and was approached through a combination of surveys and workshops. It was determined that the benchmarking exercise shall examine 11 competency areas of the vendors, namely; management and Leadership, financial systems and practices, cost structures and analysis tools, global sourcing and marketing strategies, supply chain Integration, customer focus, new model introduction capability, manufacturing and quality, safety, technology investment, and people and performance.
Measuring of the vendors’ performance, based on the above performance criteria is carried out in stage 2 to determine their current performance levels and particularly where the gaps were in relation to global best practice.

Thursday, 3 December 2015

Competitiveness is key to survival in AEC, TPPA

Economic liberalisation and regionalisation of the ASEAN region through the formation of “ASEAN Economic Community (AEC)” is forthcoming upon the recent adoption of the “AEC Blueprint 2025” by the ASEAN Leaders at the 27th ASEAN Summit on 22 November 2015 in Kuala Lumpur.
The blueprint provides broad directions through strategic measures for the AEC from 2016 to 2025.
AEC will create a vibrant and competitive single market with over 622 million people having a GDP in excess of USD2.6trillion, thus transforming the region with free movement of goods, services, investment, skilled labour, and freer flow of capital. The pack shall become the third largest economic blockin Asia and the seventh largest in the world.
On the other hand Trans-Pacific Partnership Agreement TPPA,which is expected to come into effect in next few years years, will further liberalise the participating countries into the global economic sphere with bigger spectrum of market opportunities.
The TPPA negotiations that began in 2010 took five years to conclude in October 2015 and now awaiting for domestic approvals by various participating countries prior to its implementation.
TPPA, accounts for some 40 per cent of the global GDP, aims at providing market access opportunities for its member countries to improve their respective competitive advantage and thereby enhancing their competitiveness in many aspects of trades and productions.
While both the AEC and TPP promise better regional and global market opportunities and accessibilities respectively, market penetration by respective business entities will largely be dependent on the ability of the individual company to exploit the market potential.
In this respect competitiveness of the companies is key to successful exploitation of the business and market potentials promised by both economic agendas. Competitiveness in this sense is the ability of the companies to produce to the required volume with prompt delivery at lower cost while maintaining the best quality as required.
All agendas postulated by the National Automotive Policy, NAP 2014, launched early last year were centred at enhancing the competitiveness of the local automotive players in anticipation of the forthcoming economic liberalisation and regionalisation prescribed earlier.
Programmes designed and implemented thereon were guided by the NAP focusing on competitive enhancement on various aspects of automotive endeavours.
Automotive Supplier Excellence Programme, or ASEP, is one of those programmes implemented by the Malaysia automotive Institute (MAI) to provide a structured framework for on-going improvement of the local vendors.
The programme benchmarks the local vendors against one another and the best-in-class international companies in order to establish their respective level of competitiveness.
The benchmarking exercise examines 11 competency areas ofindividual company, namely; management and Leadership, financial systems and practices, cost structures and analysis tools, global sourcing and marketing strategies, supply chain Integration, customer focus, new model introduction capability, manufacturing and quality, safety, technology investment, and people and performance.
ASEP is designed to assist the local automotive supply base in achieving competitiveness and sustainability and is viewed as a unique opportunity for vendors to position themselves on the road to growth and a sustainable future.
ASEP implementation includes supervision and coaching by experts in areas of identified weaknesses within the respective vendors rendering assistance to the companies to formulate and to implement diversification strategies for their businesses.

Thursday, 26 November 2015

TPPA promises accessibility to wider automotive marts

It all began in 2005 when four countries, namely; Singapore, Chile, New Zealand and Brunei, that signed a trade agreement known as the “Trans Strategic Economic Partnership Agreement (TPSEP)”.
The agreement later attracted the industrial powerhouse such as Japan and the USA interests to enter the trade pack, and has grown to include the twelve participating countries to form the Trans-Pacific Partnership Agreement (TPPA).
The negotiations that began in 2010 took five years to conclude in October 2015. TPPA thatACCOUNT for some 40 per cent of the global GDP may take at least two years to begin its implementation upon domestic approvals by various participating countries.
TPP aimed at enhancing market access opportunities for its member countries to improve their respective competitive advantage, and at the same time provides a platform to develop transparent rules and discipline that will create investor confidence in all member countries.
These in turns promote opportunities for skills and technology transfers between participating countries, which will result in enhancement of competitiveness in many aspects of trades and productions.
Analysts are of the opinion that the opportunities provided by the agreement with respect to trade liberalisation and removal of exports barriers would make it easier for companies within the participating countries to export their goods to other member countries.
Six out of the twelve TPP members are automotive producers with Total Industry Volume (TIV) more than 500 thousand cars per year, with USA and Japan being the biggest producers with annual TIV of about 12 million and 10 million respectively (Only passenger cars).

The US vehicles trade being the largest totaling above USD350 billion annually but facing trade deficit in the billions. Japan on the other hand is enjoying positive trade exceeding USD100 billion. The USA imports largely passenger vehicles and parts and components with annual value at about USD150 billion and USD60 billion respectively. Almost all of the automotive related TPP economies are growing positively inTERMS of their respective TIV for the past 5 years.
Malaysia’s main exports consist of parts and components primarily to Japan and the USA. However exports of parts and components to Japan had reduced by 16% from 2012 to 2014.Exports of Parts and components to the USA increased by 6% from 2012 to 2013 but reduced by 9% from 2013 to 2014.
The nation main automotive imports are passenger vehicles, parts and components and commercial vehicles primarily from Japan. However, in the last three years the import trends seem to be reducing in all the three vehicles segments. Used passengers vehicles seems to be the main import activities by the local vehicle importers.
The importation of passenger vehicles had reduced by 51% from 2012 to 2014. Similarly, the imports of Parts and components and commercial vehicles had reduced by 26% and 31% respectively from 2012 to 2014.
Availability of production volume is key to the survival of any the automotive manufacturing endeavours. Continuous pressure to liberalise the automotive home market has dwindled the sustainability of many of the local parts and components manufacturers as well as home grown automotive assemblers.
TPPA promises the removal of exports barriers would make it easier for Malaysian companies to export their goods to various member countries and thereby enhancing their respective production volume.
It is still too early to foretell the positive impact that TPPA would bring to the local automotive players but the above TIV statistics demonstrate the vast market potential for local automotive players to exploit through TPPA.
As the saying goes - The best way to predict the future is to invent it. Henceforth the local automotive players must now focus on enhancing their efficiency to ensure their competitiveness to participate in the forthcoming automotive production potentials and challenges.

Thursday, 19 November 2015

Succession planning ensures long-term sustainability

Succession planning is a proactive process of identifying and developing subordinates at all levels for future managerial roles and leadership positions in an organisation. It is a critical and strategic component in any company management however the exercise is often neglected by even major corporations.
It is often perceived that succession planning is centred on identifying potential replacement of retiring or resigning top echelons in the company. Instead the process is a strategic management exercise to ensure a ready pool of employees adequately developed to take on higher positions and responsibilities at various company hierarchies when required.
More skewed perceptions are amongst many family owned small and medium enterprises where succession planning is understood as to choose among the heirs to inherit the leadership. Little consideration is given to the importance of assessing the heir’s ability to lead and to drive the company to greater height. Many companies that were once successful have failed upon the retirement of the founders and subsequently replaced by their respective family related successors.
One may want to look back at the history of the Prophet of Islam, Muhammad, who left behind one of the greatest religion on earth upon his demise, but did not nominate nor groom a leader as his successor. However, the Islamic faith has expanded to a vast area of the globe within a short period of time after the prophet departure.
Abu Bakar by virtue of him being the closest companion of the prophet was chosen as the first leader of the Islamic faith after Muhammad, reflecting successor selection by “popular votes”. Umar, the second caliph was nominated by Abu Bakar upon request by the early faithful brought about the concept of “predecessor selection” of a leader. Umar, on the other hand, insisted that his successor to be selected by a “consultative council” where Uthman was nominated as the third Caliph. However, Uthman was murdered and there was an uprising of a rebellion against him that has led to Ali to take over the leadership of the Islamic nation.
The above series of events of the early Islamic history demonstrated the modes of leadership selection. An individual rising to the highest post of the organisation should be the one well recognized and respected by the majority of employees. Abu Bakar was said to be calm and a wise personality well- liked by the Prophet himself during their early struggle of spreading Islam.
Umar was known to be a very aggressive person and spoke his mind on any issue and was selected by Abu Bakar to be the leader after him in view of rapid growth of Muslim population during his tenure demanding strong governing.
Umar has successfully instituted good governance during his tenure and as such the council has wisely chosen Uthman, a scholar in nature, to succeed Umar. It was during Uthman tenure that the Quran was put together into a book that existed today.
Peaceful period during Uthman’s tenure did not last long and Ali rose to the occasion upon Uthman’s murder to battle the uprising rebellion. Ali, known to be a fearless warrior and commanding personality was successful in suppressing the rebellion.
These historical precedents of the early Islamic tradition above taught the early Muslim to select leaders with personality and virtues to suit the situation at hand.
The four Caliphs may have different characters and personalities but suited well with their respective governing tenure. However they have common values that further strengthen their governing abilities. Among these values were; honesty, integrity, highly self-driven, strategic thinker and positive attitude. Their work approaches were always for the betterment of their subjects and subordinates and without self-interest. Succession development of company leaderships with the above prescribed values would ensure the company sustainability for a long term to come.

Friday, 13 November 2015

Deployment of electric mobility in Malaysia

Global warming phenomenon resulting in higher temperatures, rising sea level, severe flooding, droughts, stormy weathers are amongst catastrophes nowadays increasingly common everywhere.

Scientists have hypothesised that an increase by 2°C in the earth temperature from now on would result in severe melting of polar ice, which in turn would submerge land currently occupied by 280 million people worldwide. Whilst an increase of 4°C will result in land submersion covering an areas lived on by more than 600 million people.
Exhaust emission from our personal vehicles are one of the major cause of global warming. Cars and trucks collectively account for nearly one-fifth of all of the gaseous emission, emitting around 11 kilogram of carbon dioxide and other global warming gases for every gallon of petrol

It is estimated that each country contributes in order of magnitude of 30 per cent of the global warming emission by their respective transport sector. Henceforth to prolong mankind occupancy of the planet earth using less oil is the real solution.
Rising popularity of hybrid vehicles amongst the public is a positive indicator towards reducing the usage of oil to propel our vehicles. Forthcoming electric and fuel cells vehicles into the market place are more than welcome by those who are concerned with the undesirable global warming phenomenon.

However, for those non-emission vehicles to effectively replace the conventional ones, suitable and massive infrastructure to support the vehicles must first be put in place. A predicament currently faced by most governments of today, where economically it is not viable to install the expensive infrastructure while waiting for the vehicles to come on the roads. Whilst the vehicles manufacturers simple avoiding to mass produce the vehicles without infrastructural support for a simple reason without appropriate infrastructure market penetration would be difficult.

While technological developments have gone far forefront for those non-emission vehicles with successful prototypes now awaiting mass production, the prescribed predicament is a factor that will delay in the common usage of these non-emission vehicles both worldwide and nationwide.

Increased awareness of the consequences of global warming will be the push factor for governments to seek solution towards encouraging and enhancing the usage of non-emission vehicles by their respective populace.
Malaysia, being a nation sensitive to the effect of global warming, has instituted a specific policy to bring about the use of energy efficient vehicle (EEV) in the country via its National Automotive Policy (NAP 2014) launched in early 2014. The policy encourages EEV be manufacture in the country with the hope of the nation becoming the EEV manufacturing hub in the region.

Rental, sharing or leasing schemes for electric vehicle enthusiasts have been introduced in collaborations with local entrepreneurs to promote the use of electric cars. The initiatives have started since 2014 and expected to intensify to a bigger scale by 2018.
Commercial electric vehicles usage by the local transport operators is an on-going project successfully implemented and soon it is our hope that electric buses will replace the polluting conventional ones operating in the capital cities for commuters.

Battery manufacturing locally is a crucial step towards ensuring the sustainability of electric vehicles to operate on the local roads. Initiative in this respect has been encouraging and the locally manufactured battery will be available upon the bigger penetration of electric vehicles in the local market.
Advanced research in areas such as powder production for cathodes and anodes, cell, modular production, pack assembly technique and vehicle integration procedure for batteries are on-going to support the manufacture and usage of electric vehicles in the country.

In all endeavours Malaysia must focus on creating the right ecosystem for electric mobility to flourish and its usage sustainable in the longer terms.

Electric Mobility Can Significantly Contribute Towards Reducing Global Warming

Thursday, 5 November 2015

Lifelong learning way forward for automotive skills development

Economic advancement of a developing nation depends largely on its manpower development initiatives. In this respect, sound planning and implementation of the manpower “Technical and Vocational Education and Training (TVET)” will help to elevate the skills and competencies of workers in their respective workplaces.
The recent government budget for 2016 saw a serious attention given towards the enhancement of TVET, where some RM4.8 billion to be allocated to 545 TVET institutions.
Priority given to the TVET programme is a right move on the part of the government so as to achieve the targeted 60 per cent of the 1.5 million new workers to be created by 2020 that are TVET skilled.
Creativity and innovativeness of a workforce is paramount in an industrious developed nation. These human intuitions are rarely achieved within a nation workforce without appropriate industrial exposure and multiskilling development during the early stage of their TVET training and later in their working lives.
Job hopping among workers may be perceived as their process of multiskilling acquisition but more often the end result made the person a generalist skilled worker without in-depth skills and knowledge of specific areas of work or technique.
A motorcar mechanic regularly moving from one workshop to another for his employment rarely able to focus on any specific skill on vehicle repair and maintenance job, while an individual who spent a longer term of employment on gearbox repair and maintenance, for example, will eventually become a gearbox specialist able not only to repair but innovates new gearbox concept for a vehicle.
The lifelong learning concept must be promoted to our younger generation entering the workforce. Lifelong learning can instill creativity, innovativeness, commitment and responsiveness in the workers thereby enabling them to adapt in workplaces.
However, the essence of a lifelong learning must be quantified from time to time acknowledging an individual of his or her level of achievements. A national recognition through certification scheme is the best means to regulate this endeavor.
In this respect the Department of Skills Development (JPK), Ministry of Human Resources has, since 1996, introduced a Recognition of Prior Achievement or “Pertauliahan Percapaian Terdahulu (PPT)”, certification scheme to recognize skilled workers emphasizing on the lifelong learning concept.
Individuals who are able to demonstrate skills, as outlined in the National Occupational Skills Standards (NOSS), based on previous experience and achievement held can be awarded the Malaysia Skills Certification (SKM) at various levels accordingly.
Having been appointed as an “industry lead body (ILB)” by the JPK, the Malaysia Automotive Institute (MAI) is now serving on behalf of JPK as an avenue for automotive employees wishing to be certified under the PPT programme.
The programme offers to certify employees with a minimum of 4 years working experience in automotive related field recognized by the NOSS.
The participants are required to submit their respective portfolio demonstrating their experiences with proven documentation certified by their respective current and previous employers.
The documentations are in turn to be verified by JPK appointed external verification officer as true evidences of their experiences.
In the last couple of years MAI has successfully implemented the PPT programme recommending numerous workers in automotive repair and maintenance establishments and parts and components manufacturing companies for SKM certification of various levels.
The exercise not only able to enhance the sense of achievement amongst the certified workers but at the same time MAI is able to establish close rapport with the skilled automotive workers for future manpower skills enhancement programmes.
MAI looks forward for more automotive establishments and individual participants interested in the PPT programme.

Thursday, 29 October 2015

BUDGET 2016: Developing Human Capital

It is a common perception that government will cut training budget during an economic downturn. Indeed it is true that some governments would reduce their fiscal expenditure on training to balance against revenue.
On the contrary, advance nation do not usually reduce their training budget but proportionately allocate training expenditure in line with the drop in the levels of employment during recession.
In 2008 economic downturn, the USA average training expenditure per employee fell by 11% from the previous year. Corporate expenditure reduced from USD58.5 billion in 2007 to USD56.2 billion in 2008. However the proportion of overall employees training remained unchanged with the drop in training volume remained largely in line with the drop in the level of employment.
The recent fiscal budget 2016 by the Malaysian government saw the focus given to technical and vocational education and training (TVET). In line with the budget theme of which is “Prospering the Rakyat”, a sum of RM4.8 billion is allocated to 545 TVET institutions.
Priority is given to the TVET programme as the government foresees the need to achieve the targeted 60% of the 1.5 million new jobs to be created by 2020 to achieve the status of a developed nation. The workforce must be TVET skilled to face the businesses and technological challenges ahead.
TVET programme is a long term measure to prepare the nation workforce towards economic recovery and henceforth industrial development when their new skills will be useful for competitiveness and innovativeness of the local industries.
Towards this, the Ministry of International Trade and Industry (MITI) will establish an industrial skills committee to coordinate TVET programmes in collaboration with industries and some RM350 million is allocated to finance various TVET training programmes for 2016.
Malaysia Automotive Institute (MAI) has implemented various programmes thus far towards enhancing the skills and knowledge of the automotive industry workforce, both the current employees and new entrances into the workplaces.
The programmes were guided by four main economic pillars, namely; creating new employment opportunities, enhancing career development, generating new entrepreneurs, and growing the current businesses. All geared towards enhancing the competitiveness of the local automotive industry.
Creating new employment opportunities are programmes introduced for new engineering graduates and school leavers, especially those from the vocational and technical institutions. On-the-job trainings are coordinated for graduate students for their exposures and preparation towards real working life in a popularly attended programme named “Automotive Industry Certification Engineering (AICE)”.
“Industry Led Professional Certificate (IPC)” is a similar programme tailored for school leavers from vocational and technical institutions. The programmes cooperate with relevant industries to prepare the generically trained students into specific areas of the students’ interest to open up opportunity for employment in the automotive sector.
Customized AICE and IPC were also conducted for the currently employed automotive workforce to enhance career development in their respective workplaces. Apart from opening employment opportunities and career enhancement the programmes also indirectly expose the participants to business opportunities in the automotive sector.
The proposed 2016 budget aimed at creating 25,000 new jobs and trainings for some 10,000 employees. Enhancing competitiveness of more than 100 local vendors and strengthening some 500 existing workshops and service centers are also part of the budgetary agendas, inclusive of developing new entrepreneurs in sales, distribution, service, repair, remanufacturing and recycling activities in the local automotive industry.
It is a good reason for the automotive community to applause the proposed budget and to prepare for a challenging year ahead in 2016.

Thursday, 22 October 2015

Importance of Internet of Things, Big Data Management

Internet has been part of everyday life of those opportune enough able to have access to the network. Electronic gadgetry, software, sensors and network connectivity are now the means to assist mankind to be connected to the vast data and information available round the world.
However data and information collection and exchange within the internet are almost wholly dependent of human input, which is less efficient due to people having time constraint, lack of attention and accuracy.
Billing system for household electricity supply is a simplest example to illustrate the interaction between human and computer systems in posting monthly bills to consumers.
Meter readers are the source of data input into the central computer system of a utility company which in turn process the data for billings. Human dependent for the data input often times and again proved the inefficiency and inaccuracy of the supposedly mechanized billing system.
Today advanced billing system starts with the electric meters being “smart” able to record the amount of electricity consumed within a period of time and transmit the data to the central computer system directly via the internet, thereby eliminating human involvement in the data collection. The efficiency and accuracy of billings are apparent while at the same time the contributing to reduction in waste, losses and costs.
This concept of internet application in products and human activities is now identified as the “Internet of Things (IOT)”, which name was coined sometimes in 1999 implying that machine-to-machine communication via the internet has been developed for more than a decade. The above billing system or product is considered as an object or a “thing” in the IOT and experts estimate that the IOT will consist of almost 50 billion objects by 2020.
Modern vehicles of today have numerous built-in sensors each with designated function or “Thing” to alert the drivers of the condition of the vehicles, driving conditions and other useful information. Remote monitoring of the vehicles can be achieved via the internet if each of the “Things” in the vehicles is assigned an IP address and provided with the ability to transfer data over the network.

Application of IOT within the automotive sector, albeit in the aspect of vehicle monitoring, maintenance, etc., and the management of the automotive industry per se, both the manufacturing and marketing aspects, will lead to accumulation of large volume of data and information. Ability to manage this “Big Data” is crucial to ensure successful implementation of the concept.
Big Data Management (BDM) is the process of examining large data sets containing a variety of data types to uncover hidden patterns, unknown correlations, market trends, customer preferences and other useful business information.
The data that has been analysed will be useful for remedial actions to reduce failures or to improve product design. In all the application of IOT and BDM will improve the efficiency and quality of products being produced and increasing in values of new product ideas, inspiring a surge in productivity and innovation and therefore improve the industry global competitive advantage.
Realizing the importance and the potential of the IOT and BDM in advancing the capability and competitiveness of the local automotive industry, MAI has initiated the MAI Intelligent Technology Solution (MITS) the IOT version for the automotive industry.
The platform will provide solution for engineering, manufacturing and marketing, able to enhance value creation process of the local automotive industry. With a single, easy-to-use interface, the platform provides solution using analysis, simulation, and intelligence software in a collaborative and interactive environment.

Thursday, 8 October 2015

FTAs to help liberalise automotive industry

Liberalization of the Malaysian automotive industry. As a country with a relatively small domestic market, we depend on international trade to support economic growth. As it is now, the country's exports are 120 per cent of gross domestic product (GDP).
The argument justifies the reasons why the government has been actively pursuing many free trade agreements (FTAs).
To date, Malaysia has established FTAs with Japan, Pakistan, New Zealand, India, Chile and Australia. Malaysia and its Asean partners have also established the Asean Free Trade Area (Afta) and Asean has concluded FTAs with China, Japan, Korea, India, Australia and New Zealand.
FTAs and Afta are factors Malaysia is able to sustain the average annual growth of about five per cent, despite global and regional economic uncertainties. This is due to enhanced export activities in the last few years as a result of lower tariffs.
FTAs also provide economic and technical cooperation platforms. Under the FTA with Japan, the Malaysia-Japan Automotive Industry Cooperation (MAJAICO) was established.
MAJAICO has been instrumental in enhancing quality management of automotive vendors through the MAJAICO A1 Lean Production System (LPS) implementation for competitive advantage. Recognizing the outcome of MAJAICO A1 LPS in enhancing the competitiveness of the local automotive industry, the Malaysian and Japanese governments agreed to extend it to 2015.
The recent Malaysia-Australia Free Trade Agreement (Mafta) saw a creation of a technology development and commercialization platform under the coordination of the Malaysia Automotive Institute.
In spite of Mafta being effective only from January 2013, there are already 17 technology projects worth RM200 million being developed for commercialization. Opportunities are being made available for automotive component manufacturers of both countries to cooperate and realize the potential of Australian technology and research and development for commercialization.
Human capital development, quality improvements management, processes and technology enhancement and other competitive enhancement mechanisms for the Malaysian automotive sector are also on the agenda. This platform is also being maximized to develop multi-skilled workers specializing in production, quality and autonomous maintenance.
Liberalization of the automotive industry is inevitable. It, however, will be progressive with longer phased-in periods for tariff elimination or reduction to allow Malaysian automotive manufacturers time to prepare for the increased competition.
Malaysia's economic growth largely depends on trade in goods and services boosted by FTAs. The automotive sector will become part and parcel of FTA negotiations.
The automotive sector will remain important. It contributed some RM30 billion to the national GDP last year and employed about 550,000 people throughout its value chain.
Malaysia has no alternative but to strive hard to ensure the survival of this industry. In the light of its liberalization, the local automotive industry must have a high level of efficiency, quality and competitive prices.
Central to the National Automotive Policy 2014 (NAP) is the vision for Malaysia to become an energy efficient vehicle (EEV) hub. It is an initiative to create a new arena for automotive production with the desire to fulfill the earlier vision of the nation being technological competent in the manufacturing industry.
EEV manufacturing demands new and advanced technology and requires more skilled and knowledge manpower. The new venture hopes to recreate competent manpower, which had been retarded by the currency upheaval in the late 1990.
The initiative will also help consolidate stakeholders in the automotive industry, especially the technocrats, academicians and business community, to look further to a future common objective.
A strategic approach to realizing these prerequisites is to increase the sales volume via export enhancement of completely built unit (CBU) and completely knocked down (CKD) of locally produced vehicles, along with their parts and components for the after-sales market.
Malaysia's vision to be an EEV hub is not only confined to producing green vehicles. The vision also encompasses strategies to develop the entire value chain of the automotive industry towards environment preservation and creating new economic opportunities, such as recycling, remanufacturing and others.
These strategies are about business and process transformation of the automotive industry to reduce the emission of greenhouse gases, optimize energy and achieve a sustainable framework from the standpoint of environment, economic and social pillars.
The NAP also aligns its measures to the safety requirements of the United Nations. Strategies are developed to complement the adherence to safety standards for new vehicles to include spare parts, either used or new. Directions to ensure safe levels for current running cars will also be introduced.

Thursday, 1 October 2015

Euro fuel standard key in attaining air quality

It is now seems like a seasonal weather pattern that this region will be covered with haze once every year. The haze occurrences have often upset children schooling schedules, flight landing and departures, health hazards for many young and old and many more is a man made environmental degradation of a kind.
The air quality during these haze episodes are measured using the “Pollutant Standards Index”, or PSI, which is a number used to provide the public with understandable indicator of the air pollution level at any one time. The PSI is presented as a number ranging from 0 indicating an excellent air quality to 500 indicating the quality of air at its worst.
Industrious cities such as London in the UK and Los Angeles in the USA have had haze or smog atmospheric pollution in the recent pass that resulted in both governments to introduce the Clean Air Act in 1956 and 1955 respectively. The Acts were targeted to ascertain some level of control on the polluting nature of the power generating facilities burning coal, oil and natural gas.
Today the two cities have strictly enforced the act to ensure the quality of air is within a predetermined level. Consequently the enforcement of the acts gradually affected the gaseous emission control of motor vehicles in the cities, which is equally considered as air polluting agents.
As early as 1971 upon the introduction of unleaded fuel in the USA “Green fuel” revolution for automobiles began around the globe. Malaysia began to regulate the reduction in lead content of the nation petrol supply in 1985 and further reduction was enforced in 1990. Nine years later, in 1999, the nation petrol supply was declared totally unleaded.
Meanwhile in 1994, the European nations began to implement the Euro 1 standard replacing their leaded fuel with the unleaded version.  Further reduction of the carbon monoxide (CO) emissions was then achieved through additional enforcement of fitting the universal catalytic converters to the vehicles exhaust system.
The introduction of Euro 2 in 1996 was to limit the emission of other harmful gaseous such as unburned hydrocarbons and oxides of nitrogen for both petrol and diesel vehicles. Substantial reduction of sulfur contents in fuels were also regulated under Euro 2 limiting the content to a maximum of 500ppm for diesel engine.
Euro 3 fuel standard was introduced in 2000 promising to further reduce the sulfur contents for diesel and petrol set at 350ppm and 150ppm respectively. Consecutively Euro 4 and Euro 5 fuels standards were respectively implemented in 2005 and 2009 ensuring further reduction in sulfur contents of 10ppm and harmful gaseous emission in vehicles.
Recently introduced Euro 6 fuel standard is imposing a further 67% reduction in Nitrogen Oxides exhaust emissions compared to that of Euro 5 for diesel engines. Contrary to the earlier perception that diesel is a polluting fuel, the modern diesel engine, coupled with Euro 6 fuel standard, are now considered advanced automotive fossil fuel power train capable of meeting the Energy Efficient Vehicle set criteria.
The government initiative towards encouraging fuel efficient and environmental friendly motoring quality fuel is now being promoted with the introduction of Euro 5 diesel in the market place. In 2014 some 13 stations in the southern part of Malaysia began to sell Euro 5 diesel marking the beginning of high fuel quality entering the country, meanwhile Euro 5 diesels is now available in Klang Valley.
The introduction of higher Euro fuel standard is an important way to help the nation in its battle to attain air quality with the continuous haze occurrences from time to time.

Thursday, 17 September 2015

Is now the best time to consider buying a car?

IT was recently announced that Malaysia has maintained a steady growth rate in the second quarter of this year, with gross domestic product (GDP) at 4.9 per cent.
Although there was slight reduction in the second quarter GDP figure as compared with the first quarter (5.6 per cent), economists are confident that the nation may attain a GDP of between four and six per cent this year.
It is comforting to note that despite the current global economic turmoil and the ringgit’s devaluation, the nation’s GDP remains positive.
In contrast, when compared with the 1998 currency crisis, where Malaysia’s economy was badly affected, GDP growth slipped from 7.7 per cent in 1997 to -6.7 per cent in 1998.
The ringgit weakened from RM2.50 against the US Dollar to a lowest value of RM4.88 on January 7 1998.
Similarly, the 2008 financial crisis caused by the collapse in export demand to the US, has slowed down Malaysia’s GDP from 4.6 per cent in 2008 to -1.7 per cent in 2009, but the local economy recovered before long to post a GDP of 7.2 per cent in 2010.
Despite the uptick in the GDP figure noted earlier, the administration is not resting on its laurels in the face of the current global economic downturn and the depreciation of the local currency.
The recent formation of the National Export Council (NEC) is one proactive initiatives to help steer the nation towards better economic performance under current global and domestic economic conditions.
The automotive sector is one of several economic sectors to be promoted under the NEC.
The platform is expected to assist in the enhancement of automotive related activities in export requirements such as testing, market access and business matching among industry players.
The National Automotive Policy, NAP 2014, has prescribed various assistance for automotive vendors in strengthening their production activities and to exploit export potentials for their output.
It is during these trying times that is best for the vendor community to take a step back to re-evaluate their respective business plan and to reinvigorate their plans towards export diversification.
Focus on enhancing the vendors’ competitiveness remains the prime objective of the NAP and it is best with the current slowdown that industry players are to focus on extending more activities towards competitive enhancement within their respective organisation.
Competitive enhancement is a continuous effort and is generally "easier" to achieve during difficult times as people are more focussed on their job performances.
They are more dedicated towards their work responsibilities so as to remain relevant to the company given the economic slowdown and hence possible job redundancies.
Psychological factors are at play in the sales and purchase of vehicles between consumers and automotive manufacturers during this trying time.
On one hand, consumers tend to be pessimistic towards vehicle purchase for fear that the economic uncertainty may affect their purchasing power and house hold expenditure.
On the other hand, vehicle manufactures are responding to this consumer sentiment with highly geared vehicle sales promotions and plentiful of interesting gadgetry and discounted offers.
This is the best time either for the first-time car buyers or replacement car purchasers to consider the benefit the promotions have to offer.
Higher safety standards, good comfort and many security features are the forefront of those offers which can be excellent bargains.