Enhancing the competitiveness of auto-parts enterprises: The case of proton’s suppliers

The launch of the national car project provided greater opportunities
for local enterprises to be involved in the auto-parts making industry.
However, the unprecedented pace of globalization, trade liberalization
and capital movement in recent times has posed great challenges for
local enterprises, particularly auto-parts suppliers to compete in the open
market. Public-private partnership would be one of the ways to mitigate
the unexpected impact of globalization. This effort would be more effective
if factors contributing to firm competitiveness are known in advance. This
paper provides empirical insights into factors affecting the competitive
position of auto-parts suppliers operating in Malaysia. This paper furnishes
useful guidelines for the firms in order to remain competitive in the
open market mechanism and for better public-private partnership in the
automobile industry. A multiple regression analysis of primary data showed
that two internal factors – quality and ownership structure, pose significant
influence on the competitive position of auto-parts enterprises. Hence, any
public-private partnership drive to develop the sector, especially the small
and medium enterprises (SMEs), should be devoted to these two assets.