This article first appeared in The Edge Malaysia Weekly on March 11, 2019 - March 17, 2019

The tender for the management and supply of the government’s fleet of vehicles that closed recently raises a number of issues.

First, it comes as a surprise that the government limited the choice of cars to Proton, Honda and Toyota, and that participation in the tender was via invitation.

Invited to tender were incumbent Spanco Sdn Bhd (which has held the concession for the past 25 years), Hertz Malaysia under Sime Darby Bhd, Avis Malaysia under DRB-Hicom Bhd, and Naza group.

But with DRB-Hicom controlling 50.1% of Proton Holdings Bhd, which manufactures Proton cars, and 34% of Honda Malaysia Sdn Bhd, which assembles Honda vehicles, what chance do the rest of the companies have to secure the contract?

Spanco, Sime and Naza are already in a disadvantageous position as they would have to get the vehicles at a higher cost, after adding DRB-Hicom and Avis’ margins.

Shouldn’t the government agency that called for the tender have known this?

And why limit it to only three marques? Wouldn’t it be more competitive to just give the specifications of the vehicles required?

So what happened to open tenders?

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