Coming Home, Walk Like a Pinoy?

Future BRP Jose Rizal

SHAH ALAM: Coming Home, walk like a Pinoy? The future BRP Jose Rizal, the Philippines Navy first guided missile frigate arrived in Subic Bay, Manila, late on May 23, 2020, some one month after its scheduled delivery. The delay is attributed to travel restrictions imposed due to the coronavirus. The Jose Rizal and its sister ship, Antonia Luna, were planned around the same time as our own LCS but as the Philippines had no state-owned shipyard, the construction of both were entrusted to South Korean Hyundai Heavy Industries (HHI) which won the tender for the programme.

Future BRP Jose Rizal

The cost for both ships are some USD$315 million (RM1.374 million) – according to Philippines News Agency – with another USD$40 million (RM174 million) for weapon systems and munitions.The ship is fitted with a 76mm gun, one 30mm guns, two SHORAD missile launchers, four SSM and twin triple torpedo launchers. The ship is also fitted with an eight-cell SAM launcher, meant for VL-MICA but not equipped with them for the moment. It is equipped with a Hensoldt TRS-3D radar, EO and hull mounted sonar with a towed sonar planned for future fitting. For more detailed equipment list go here

From the Inquirer.

The Philippine Navy’s first brand new warship, to be christened BRP Jose Rizal (FF-150), dropped anchor in Subic Bay, Zambales on Saturday (May 23) after a five-day voyage from Ulsan, South Korea.

South Korean shipbuilder Hyundai Heavy Industries (HHI) delivered the first of two 2,600-ton missile-capable frigate of the Philippine Navy. It carried 31 Korean crew men and 61 Philippine Navy sailors.

The future BRP Jose Rizal was escorted by the BRP Andres Bonifacio (PS-17), together with one Agusta Westland (AW) 109 helicopter and C-90 fixed wing aircraft toward the anchorage area on Friday afternoon (May 22), the Navy said in a statement.

Early Saturday, the future BRP Jose Rizal received passing honors from BRP Andres Bonifacio and three multi-purpose assault craft with Navy anti-submarine and AW-109 helicopters hovering above.

Before the ship’s tentative commissioning set on June 19, the birthday of Jose Rizal whom the ship was named after, the crew will first go on quarantine prior to final acceptance evaluation by the Technical Inspection and Acceptance Committee (TIAC), the Navy said.

Despite the seemingly smooth delivery of the ship, it had not escaped controversy in Manila as reported by the Inquirer.

A Philippine Navy TC-90 aircraft flies near future BRP Jose Rizal as it enters the country’s territorial waters. Philippines Navy

The selection of combat management systems (CMS) for the frigates had put the deal in national spotlight in 2018. The Navy was then pushing for Tacticos of Thales Nederland, a CMS already compatible with Link 16, compared to the CMS picked by the HHI, which was Naval Shield ICMS of Hanwha Systems.

The contract stated that the shipbuilder would have the “sole right” to choose the subsystems, which was then opposed by the Navy but not by the Department of National Defense.

It is interesting to note that HHI had claimed that the Naval Shield ICMS had been proven as it had been fitted on South Korean Navy ships as well as the RMN’s DSME designed but locally built training ships. It must be noted that Jose Rizal was launched one year ago some two years after the contract was signed. This means that HHI built the ship within 24 months.

Anyhow, Selamat Hari Raya, Maaf Zahir Batin to all Malaysian Defence readers.

— Malaysian Defence

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Shah Alam

61 Comments

  1. Jose Rizal-class CMS same as our gagah Samudera-class CMS

    and…

    Jose Rizal-class main radar same as our Kedah-class main radar

    If they don’t want that ships just sell it to us. Hehehehe, just kidding. BTW congrats Pinoy 🙂

    Hope Mr Marhalim or anyone here can update about our LCS status.

    And Selamat Hari Raya Aidilfitri to all.

  2. Time and again it shows RMN is always getting shortchanged. For the price of slightly more than what we paid for 1 Meko 100, the Philipines is getting 2 2600 tonnes frigate! It comes with SSM, torpedo and Simbad also, unlike our kosong ships!

  3. Yes the Philippines got a lot of ship for their money, however much grumbles some of them had about the link-16 unavailability (yeah that is you max). Malaysia barely got a single OPV in the shape of the meko 100 for that money, so filipinos count your blessings. So in all, congratulations to the Philippines for their new frigate. It will complement your Wildcat helicopters well.

    So as the meko 100 is mentioned, we need to talk about it right?. We can probably never be able to build ourselves the meko 100 for the price of that korean frigate, which is why i always say to forget those mekos, even though i have written here long time ago how we can possibly build one and arm one for the price of the korean frigates. The high cost of building the mekos is partly because of the high design standards of germany. The materials, frame spacings, battle damage tolerance, ship control systems etc etc makes the ship inherently expensive to build. In layman terms it is like manufacturing a mercedes car compared to a kia car.

    But should we do something radical, abandon the gowinds, and buy something like this direct from korea instead? IMO it is very foolish to abandon our manufacturing capability, especially now when we really need to pour money into our own economy to prevent it from collapsing into recession. However flawed it seems right now, we have exported ships before, we have build plenty of ships that is technically good, including the kedah and samudera class ships. For the gowinds, IMO we need to persevere, complete the 6 ships and try to recoup the losses by building a batch 2 of them for less cost than batch 1. In any case, those gowinds will be far more capable than what the Philippines frigate can ever be.

  4. Yeah maybe no more new mekos..what im proposing here is to arm them accordingly.At the very least we’ve got ourself 6 more capable corvettes compared to just 6 gun opvs..Our other corvettes is almost non existant anymore..or do u prefer we rearm our other old corvettes in the form of laksamanas and kasturis..Bare minimum armament is good enough..i dont know about you guys but i strongly believe we still need smaller corvettes in our arsenal 6 or 8 will do to complement the bigger lcs and future lcs batch 2/type26/type31..

    Reply
    As I had posted earlier, there are some issues on the Kedah class which needs to be addressed first before they could be fully arm. The fixes will add up to the cost so its not a simple thing of just buying the weapon systems.

  5. @…

    I think whenever we talk about the Meko 100 there’re few points always got mixed up.

    I’ve a previous post which went into the SCS so I’ve to recall what I typed.

    1. Meko, being built to a purportedly higher standard is more expensive. Ok, everyone accept that. The question is, is it really ‘that’ expensive.

    I think our Meko 100 is the world’s most expensive meko per tonne. Not talking about the Anzac class, the South African Meko A-200 costs about US 350 including armaments in 2007. This is less than the price we paid for our kosong ships! So looks like Meko is not ‘that’ expensive afterall. Or you can say a fully equipped Meko A 200 at today’s price (USD 500m) is about 2.5 times of the Pinoy ships, but how about the Meko 100 which we already paid for the whatever ToT? If, hypothetically our Meko 100 come equipped with MM40, RAM, A244 on top of the Oto, and costs USD 350M I think we will all be happy, or at least won’t have as much to complaint. That’s still 2 times the prices of the Korean frigate…

    2. Whether to build locally, to boost up local ship building industry, to benefit the people etc…

    PM 6 laughed at Mat Sabu about cancelling the 2 locally built LMS 68 to save RM 100+ million. But what’s so great of having this ‘locally built’ LMS when you’re paying more than a Damen 1800 for such ‘Made in China’ ships? I think the notion of prop up local ship building capability only make sense if it REALLY bring benefit to the country as a whole. That means we save on the money spent, build up support and maintenance capability and providing jobs to the people. If providing jobs to a certain shipyard for 2 years needs RM100+million, and end up with overprice ‘design’ and subsequent purchases, it’s better of to just halt the LMS 68 project.

    3. Local ship building capability. I think Shin Yang proved that with or without Gowind, Meko 100, LMS 68, they can build landing ships deemed good enough for the UAE navy. Granted we need the design, and we certainly need to enter into some form of JV with foreign companies. Key point here is to find a trustworthy and reliable local company! If we can’t we just buy it as CBU to save the billions.

    However as we all know everything here is heavily ‘influenced’ by all the party of interest. If everything can be done just ‘slightly’ better our armed forces won’t be at it current sorry state. Billions of ringgit can be saved instead of move to some pockets…

    Reply
    It must be noted that the Kedah class was expensive as it was a national interest project apart from the ships it also involved funds to upgrade the yard to built ships and also the IP rights for the ship design. Also extra money had to be pumped in to revive the project as the then owner of the shipyard had squandered most of the money for his own and political masters benefit. Basically we paid for 12 ships though we only got six.
    It is, for those with only recent memory, the 1MDB of that time. And everyone involved got off scot free and not even their reputation were sullied.
    That’s the reason the ships cost so much as the total sum allocated for the project had increased exponentially.

  6. RM174 million for weapon systems and munitions for this two (2) frigates. So, if we want to upgrade our six (6) Kedah-class using this figure and armament its just around RM530 million. The price can go lower because our Kedah-class already owned guns and also better sensor, radar, fire control radar, ESM ect. CMIIW.

    Reply
    The radar is the same actually as it was previously owned by Airbus and sold to Hensoldt. That said it could have newer and better electronics and software as ours were ordered some 25 years ago

  7. @Hornet Lover
    “That means we save on the money spent”
    That is fallacy thinking for any ToT projects whether it be done in Malaysia, or Japan, or UK or India or Singapore. Even if you could save money on labour cost, the CKD development cost will be nearly on par or more of the savings you get with cheap labour and you will definitely incur delays (which relates to cost).

    The main purpose for ToT should be to provide jobs to locals, which is why it make sense for volume production that takes multi-years. The point is to make the build realistic and manage the cost, something which LCS project team didn’t (or likely couldn’t?).

    IMHO, if we could cut 10-20% of cost for each subsequent LMS batches, it make sense to build them locally as this is gonna be the bulk of TLDM fleet. Perhaps something the short-term thinking PH Government didn’t see. More importantly this could provide jobs to many for 5-10 years so you can imagine the economic multiplication factors. Yes, its a National Service project. Yes, its gonna be more expensive building locally. No denying that. Its how we could come to a compromised win-win for all. Doing ToT for all makes no sense and building everything overseas makes no sense.

    @Fadiman
    Marhalim reported no progress yet.

  8. I also think if we paid for the ‘ToT’ for the Kedah class, we should be trying to maximize the investment. I wonder how much Shin Yang could build the Kedah class ships for if given the rights to do so?

    Does anybody know if we also bought the rights to the COSYS M1 CMS?

    For what the current kosong ships do ie patrol, even the COSYS is probably enough.

    Don’t need to change anything, maybe standardise on the Bofors 57mm upfront and the MSI 30mm at the back, if we dont get overcharged for those 2 guns, too.

    On a side note, when can we hear about the Indian CMS on the Jebat?

    Reply

    The COSYS was customised for RMN so it is likely that we paid for its IP too though I am guessing one has to comb through the documents to see whether the PSC NDSB, the forerunner of BNS, actually paid for the IP. If they didnt I am guessing that we don’t have the rights for it. No idea on the CMS probably at the next Lima

  9. @ hornet lover

    marhalim has explained quite a few of the concerns but i will add a few of my details.

    1. the meko a-200san price is without armaments and even the CMS. it was fitted out locally in south africa. it helps to keep the cost down with a lot of the armaments like the CIWS and anti-air missiles are locally designed and built. The tacticos based CMS was locally customized. It is said that 60% of the CMS was written locally.

    2. Funny that you compare the LMS68 with the damen 1800 OPV which was actually built locally, and cheaper too than the LMS68. The LMS68 is basically a patrol boat with the price of a corvette all due to 1MDB. The navy, the local shipyard, all paid the price of leaders that squander the government money for themselves, with china only happy to help to settle the mess.

    3. Technically we can build ships. We have 40+ old FACs built locally that are still operational. The question is can we have leaders that have the interests of the country first instead of their own personal gain? Can we ourselves have the interests of the country first instead of our own personal gain?

    @ joe

    Yes to have Tot means you need to build further batches to make it worthwhile. For the meko 100 it should be but the cost building more of them is not worthwhile conpared to alternative OPVs. There are things you should do locally, then there are those that you shouldn’t even try to, like thinking of locally assembling our MRCA.

    @ encik

    For an OPV the COSYS CMS was probably an overkill IMO.

  10. how would malaysia compare with the Filipino plans? lets say we go with my plans which i posted a few articles previously.

    MMEA/TLDM to 2030

    3 scorpenes (additional 1 from currently 2026-2030)
    9 gowinds (3 more 2026-2030)
    2 Lekiu
    2 Kasturi
    18-20 OPVs (including 6 kedah, 2 japanese OPV and 3 in build damen 1800 OPV. all newbuild OPV under MMEA)
    2 MRSS
    4 LMS68
    15 LMS new type (if my plan instead of 8 more LMS68 of tldm plan)
    14 FAC
    12 NGPV (additional 6 from currently)
    60+ FICs (including MMEA Penggalang, TLDM CB90, new FIC and KASTAM Perantas)

  11. Actually the gov must relook at the strategy now.. Boustead Naval Dockyard just cant jack it anymore. Just try to resolve the two existing ships with BND. Cancel the orher 4 ships. Open the building contract to other shipyards. As it is the economic bebefit from the LCS has been maximised. S work has syopped I am sure Boustead will not keep the workers any longer and not doing anything. Before the dockyard was privatised, all repairs n maintenance were contracted out to commercial yards n these yards did a good job for our navy. Just go back to that time. Open the repair n maintenance to Malaysian yards that has the capability n capacity. Only established yards with good records should be contracted. Tender for other yards to build the other 4 ships. When there is competition Bousted will have no choice but to buck up.

  12. @joe
    “That is fallacy thinking for any ToT projects whether it be done in Malaysia, or Japan, or UK or India or Singapore.”

    I failed to understand your reasoning. If it’s meant to be more expensive to produce warships locally then what good will it bring to our country just to keep a certain industry alive, knowing that particular industry is run by incompetent people, no economic of scale and more importantly we never really have such industrial base to start with? I really don’t think we need to go too far from our national car project… If CKD is meant to be more expensive then all cars should be CBU. Of course the car industry is run by more competent companies…

    Furthermore, how many percent you need to chop off the LMS 68 to make its’ price reasonable? How many units or batches to get before it can be slashed to a more reasonable price? It’s a patrol boat, and it’s more expensive than the other patrol boat to be obtained by the MMEA with 3 times the tonnage. It’s a super dumb deal, sealed by PM6, and everyone seemed to know why the excessive price.

  13. @joe

    I forgot to add another point.

    If according to you it’s a National Service project, and it’s to be more expensive to produce locally, but with the benefit of providing jobs locally …
    Then you must be in full agreement when PM 7 said he wanted to start our 3rd national car project!

    There are just too many areas we can provide jobs to the people, especially with massive fund on hand. Is it making any economical sense, will we be able to come out with a tangible defense industry, or do we have the purchasing power just to prop it up with our own funding? The politicians will want you to believe everything is to be built locally, albeit more expensive, “to the benefit of the rakyat…” Yucks…

  14. If no rights to reuse COSYS then just hentam aje la menatang Vibrant CMS tu. At least it wont be running on Windows 95, hopefully.

  15. We should forget about building ships locally as the national interest at stake is always personal interest of businessmen and cronies. Just let foreign shipyard build the ships and we concentrate on things we are good at.

  16. @Hornet Lover
    “If it’s meant to be more expensive to produce warships locally then what good will it bring”
    Like I said its a National Project, and on face it certainly looks to be a bad deal. But the point of National Projects are to provide jobs and induce an economic multiplication impact that would ideally generate more income from the workers & staffs consumption and taxes than additional cost the project incurred.

    You talked about National Car project. Okay, on a certain level if we had Thai or Indonesia size of population and marketshare, it makes sense (that was also another goal of PM4). The problem is we have too many players in a small market. Perodua is making money, Proton not so but they are turning a corner, and now comes P3 going for the same marketshare. Its all about supply and demand, and having 2 player ady there is overcapacity whatmore adding a 3rd.

    The same with ToT projects here. If its only for limited numbers, it makes no financial sense as the economic impact is shortlived and the cost of expenditure cannot be recoup. But if its like AV8 or supposedly LMS project, the cost of build should go down with smart nego for subsequent batches and as the job keeps going, the economic impact is visible. If you were to see Rawang, Tg Malim, Pekan, Kulim, these places wouldn’t be same without Perodua, Proton, DRB, Inokom. Even Shah Alam wouldn’t be what it is today without Swedish Motor Assemblies, ASSB, Ford factory, and their parts supply chain in the surrounding areas.

    As for how many % will make the LMS cost acceptable…. well I never did say we should stick to the Chinese one, did I? But since we owned the IP as usual (or did we?), there should be a cost comparison done either to restart it or go for another one to be ToT’ed.

    @Abuyane
    What are we good at, other than producing an endless supply of inept politicians?

  17. wow… dont know where to start.

    @ lee yoke meng

    The current LCS failure is not caused by BNS alone. So the consequence also should not be borne by BNS alone. Countermeasures should be promptly executed to complete the 6 gowinds. Future ship projects should involve all other shipyards in malaysia, this can start with the MRSS, LMS follow on and MMEA ships. What we can do is using korean way. The mindef and navy getting their wanted ship design first, then bidding the design to shipyards later.

    @ hornet lover

    There is nothing to discuss about LMS68 on local build or whatnot. Its absurd price is a cover for china to pay off our 1MDB debt. We can built bigger ships that cost less than the chinese LMS68, which is the damen 1800 OPV. Does the LMS68 absurd price really mean china are worse in building ships than malaysia?

    Locally manufacturing defence items has many other points of interest other than just cheaper cost or the economics of scale. Some of the things that we can develop by locally manufacturing defence items
    1) to develop the knowhow of a said item. to have a pool of people well versed on the item.
    2) to be able to manufacture more of the said item. this is very important point. if there is no desire to build more of the item that is tot, then there should be no need for a TOT or local build. A good example IMO is Indonesian TOT of the daesun LPD. They manufactured follow on modified design for their own navy, and exported it too.
    3) to be free from diplomatic issues in the future. if in the future the country has problems with the original tot country, we can slightly modify the design and use equipments from other country to compensate.
    4) we would understand more about the item when we need to overhaul, extend its life, or upgrade them.

    Using the automotive industry as a sample of failure is not correct IMO. While not building as much cars as thailand, our local automotive industry, human resource and developmental capability is way ahead of any country in south east asia, all because of our national car projects. We have plenty of components manufacturing capability other than just the big car manufacturers. Our local automotive engineers are sought after in japan, china and even vietnam. I know of senior engineers in Vinfast vietnam that are malaysian. I know of malaysians setting up automotive plants all over south east asia. Plenty of components in BMW, porsche and mercedes all over the world actually built in malaysia. Almost all toyota 1.5 engines in south east asia is also built in malaysia. Just to show some examples.

    @ abuyane

    We are going to spend somewhere around 7-10 billion us dollars in the next 10 years for defence equipments. So you are saying that all of that money should go to giving mat sallehs jobs that malaysians can do? Do you prefer mat salleh tukang welding families prosper rather than tukang welding from sibu, sandakan or sekinchan? Yes there might be no economic of scale. Yes probably 90% of the raw materials is imported. Australia is in the same situation too. But it prefers the job done by Australians, so that they could spend on their families, even if thst means the cost is higher than buying it direct from overseas.

  18. There was a time when malaysian believe that they will not fail.
    There was a time when malaysian believe that they are rich enough to do anything.
    There was a time when malaysian believe that singapore was the only state in SEA which was better in economy and military development.

    Suddenly, Indonesia was rising. The Indonesia was bouncing after they were hit very hard by 1998 crisis. Step by step they learned and made progress. They can do what many malaysian believe they can not do.

    I do believe malaysian is racing with pinoy in military development. Forget about SG and indon, both of them are already running ahead. When malaysian will learn like the indon did? Repeating the same mistake will not give a different result.

    Pinoy already recieved they LCA FA-50 and their brand new frigate while RMAF still on talking in getting LCA and still waiting to get LCS which will be first received in 2023 if not delayed again. Building a frigate in 10 years is already a joke.

  19. off topic

    China fishing militia

    http://www.rand.org/blog/2020/04/a-short-history-of-chinas-fishing-militia-and-what.html

    http://medium.com/fairbank-center/understanding-chinas-third-sea-force-the-maritime-militia-228a2bfbbedd

    http://www.eastasiaforum.org/2018/08/04/vietnams-response-to-chinas-militarised-fishing-fleet/

    we can clearly see the china fishing militia operating to shield the Chinese survey vessel during the west capella standoff. What should our response be to this menace? Should we create a some sort of marchant marine of fishing boats to counter this?

  20. @…
    Just to add more, there is a very well-known global truck brand from Sweden that uses exclusively suspension parts sourced from a giant local component autoparts OEM maker. This part maker wouldn’t exist if we never had a local automotive policy.

  21. “What should our response be to this menace? ”

    1. We study other countries responses to this kind of action.

    2. Select the ones which fit us.

    Not sure if it is sustainable for us to create a marchant marine fleet of fishing boats.

  22. @joe

    I believe our main problem is that we have very little accountability in our projects? And the fact now is that we are facing political instability too doesn’t help the situation.

    Just a thought, do you think the change in government in the last GE might have hindered our defence planning?

  23. @joe

    Luckily when our angkasawan first flown to space we didn’t harbour the idea of producing all space ‘tourist’ equipment locally
    – as a national service
    – to give jobs to the locals
    – induce economy activity

    We could have pay Russia for TOT to produce the space suit, the helmet and what not. But don’t get too upset, as we really did produce our own 100% Malaysian space nasi lemak! Too bad the Russian is not interested in a ToT for that…

    You know, a politician could have said all the points you made for any kind of crappy deal. The hypothetical “space tourist equipment ToT national project” above is just how they can make the people believe in their pocket boost project.

    Key point here is economic of scale. Just compare Proton and Perodua. If perodua were to replicate what proton did and only manage to sell in Malaysia it’ll surely go the same path as proton. As I said earlier, it’s run by more competent company, (read Daihatsu) and be the assembly plant for the many Daihatsu or Toyota SEA car models.

    “The problem is we have too many players in a small market.”

    I thought you just countered you own point about building the few ships locally with the above. Just change the statement to
    “we have few players in a none existent market”

    We just can’t start a national project for everything, (ok military equipment) that we intend to own. It sounds extra nice to the ears of the people, but the extra money spent could be put to better use for an industry that is more relevant to our country.

    And mind you, the Kulim, Pekan and everything you mentioned DID NOT result in more expensive CKD Honda, VW, Toyota . Unlike all the silly NGPV, LMS, LCS projects.

  24. @…

    I think you reply to me is more of a reply to joe.

    Let me rewrite the points so that it’s clearer to read:

    1. When you start a “national project” that always resulted in billions burnt for something we never fully utilise, whatever ToT

    2. When the project always resulted in the equipment costing at least 2 times as much

    3. When the project always causing massive delay

    4. When the project always resulted in someone getting extra rich by ill means

    Do you, as the people, still want to see that “National project” being carried out?

    Don’t get mixed up with whether it’s good/sensible to have a local building/assembling capability. Everyone knows that if we can build everything locally it’s perfect. Can we build/assemble everything locally?
    Even if we can, at what cost monetary or otherwise?

    I’d say your example of the welder is inaccurate. Why don’t we build our own fighters/missiles/everything, as according to the same logic, you want to see the money go out to feed the mat salleh while the few aeronautical engineers in UTM starve to death?

    Ok, maybe we’re not too bad since there’s someone who claimed we can produce our own fighter in what, 2035? Hahaha… Then

  25. … “Our local automotive engineers are sought after in japan, china and even vietnam. I know of senior engineers in Vinfast vietnam that are malaysian. Plenty of components in BMW, porsche and mercedes all over the world actually built in malaysia.”

    If our engineers and our parts manufacturers can be competitive on a global level, more power to them. They don’t owe their success to a tax policy that screws the end users.

    joe “You talked about National Car project. Okay, on a certain level if we had Thai or Indonesia size of population and marketshare, it makes sense (that was also another goal of PM4). The problem is we have too many players in a small market. ”

    The problem is that Proton and Perodua are only viable if they have a substantial share of the ASEAN market for passenger cars. The Malaysian market is simply not big enough (about 600,000 cars annually). At the time Proton was set up, it was intended that Malaysia, Indonesia and Thailand would specialise in producing different vehicle classes (passenger cars, MPVs and pick ups respectively). This was of course unrealistic as there was and is no reason for them to surrender their much larger markets (each about one million cars annually) to us.

    As such, national car makers survive only because they are shielded by taxes on CBU and CKD cars, which allows them to raise their prices and screws the end users as usual.

    “Like I said its a National Project, and on face it certainly looks to be a bad deal. But the point of National Projects are to provide jobs and induce an economic multiplication impact that would ideally generate more income from the workers & staffs consumption and taxes than additional cost the project incurred. ”

    You got it wrong. Salary constitutes a fiscal multiplier. Taxes and inflated car prices represent the opposite. It is a reduction in disposable income since money is taken out of the hands of consumers and channeled to the government and to inefficient industries. If this money was not de facto forcibly taken away from consumers, they would be spending it and circulating it through the economy, rather than it being hoarded by the rich.

    As you can see, the usage of CKD cars support our parts industries which are globally competitive and efficient industries. The jobs they create are economically justified and the human talent meets global standards.

  26. @ joe

    Yeah, that is just a few examples of what our automotive industry can actually do, far cry from the we can only “just rebadge” mantra that people not in the automotive industry always repeat.

    Similar to our aerospace industry. Although we don’t build any complete airplanes by ourselves like Indonesia, we do manufacture a lot of engine and aerostructure (both composite and metallic) components for all large OEM manufacturers like Airbus, Boeing, CFM and Rolls Royce. Not to mention our matured MRO outfits that can fully maintain and upgrade the C-130 hercules family for example.

    Our Defence industry can be further improved too. What can be done.

    1) To get the volume that we need, we need to involve other friendly countries to jointly manufacture the same thing that we need, or to invest in malaysian defence industry. Probably we can join up with Brunei, Bangladesh, Pakistan, Bosnia, Kazakhstan etc to leverage the bigger volumes and expertise.

    2) Only do TOT or buy IP rights only if we plan to buy that same thing in the long run. Plan to use the IP to build more and export the item.

    3) Learn during TOT and do it on our own. For example, there is no reason for us to continue paying royalty to Colt to licence build more M4 when the patent is already expired. By now we should be able to make our own M4 clone as good as colt made components, even if major components like the chromoly barrel needs to be outsourced.

    4) Leverage our civilian engineering expertise for defence equipment. We have mature oil and gas engineering capability, as is our automotive design capability. Those resources can be used to create our own defence equipment, it can be done, if our military want and need is grounded in reality and does not request impossible things that is.

    5) Look back at all our IP that we already had. Why not revisit them? For example it is a waste to let the MD3-160 Aerotiga design just idle. It would be a great new civilian trainer by
    – fitting new Continental CD-155 turbodiesel engine that can run on cheap jet fuel instead of avgas.
    http://4.bp.blogspot.com/-1wOPkqXY-D0/UklJeJwtFXI/AAAAAAAAAQY/RjntaY2y9O0/s1600/DieselAir+-+172+Redhawk1.jpg
    – Equipping it with the latest advanced but low cost avionics like the Garmin G3X Touch certified, with touchscreen displays like latest handphones.
    http://static.wixstatic.com/media/f57485_5be2324db4974364b4ea25f96ab4ee51~mv2.jpg/v1/fit/w_2500,h_1330,al_c/f57485_5be2324db4974364b4ea25f96ab4ee51~mv2.jpg
    – equip them with ballistic parachutes for whole aircraft rescue, and seatbelt airbags systems.
    http://static.wixstatic.com/media/f57485_2cf24ac1c4c04b5fb5d5b11a67186288~mv2.jpg/v1/fill/w_1000,h_895,al_c,q_90,usm_0.66_1.00_0.01/f57485_2cf24ac1c4c04b5fb5d5b11a67186288~mv2.jpg
    – jointly build them with say Piper Aircraft, which is wholly owned by the government of Brunei.

  27. @ am

    ” They don’t owe their success to a tax policy that screws the end users ”

    Without the tax policy, there would be no automotive industry in Malaysia. Supporting our national cars is what created all these components manufacturers and designers. And it is not done only by us. Imported cars in thailand for example are actually more expensive than in malaysia. Even america does it, which is why japanese and european automotive companies are forced to set up factories in usa.

  28. @ hornet lover

    When did i say everything needs to be done locally? so why did you keep hitting on that point?

    @ nimitz

    Only Vietnam has really responded to the problem. And their answer is to create their own fishing militia too.

  29. @ romeo

    I believe we can still do it. if we are positive enough and see everything as a glass half full.

    But there is too many negative thinkers both in our leaders and the people in general. Even with our meagre budget we can achieve so much more if we put malaysia first. I have put out plenty of ideas here, and each one can be done within our current level of budget.

  30. @Hornet_Lover
    You’re taking things out of context. How does sending Angkasawan to space:
    1) Give jobs to the locals
    2) Induce economy activity
    When it doesn’t take place in Malaysia?

    How do you term it as “National Service” when even MKMs (as part of the deal) were fully built in Russia equipped with SA & EU systems? AFAIK only the servicing done here would involve our technical people.

    And CKD-ing did not result in more expensive cars? That is BS. Try compare a Civic here with similar priced Civic in Japan and you see how kosong our cars are. This is more an ASEAN problem per se, Thai & Indon Civic are similarly priced & similarly kosong, and if without P1 & P2 getting better specs nowadays, we’d still be getting the same kosong Japanese cars as 10 years ago.

    @AM
    Perodua is thriving just by living off Malaysian market alone so its all about how much the marketshare volume, and we have overcapacity with P1 & P2 existing. Taxes is a resultant of income from salary, if there are no jobs there is no salary hence no taxes. The purpose of National Projects is to create these jobs. The cart don’t come before the horse.

    ” the usage of CKD cars support our parts industries”
    Does it? All it needs is take the mould & design from the originator and replicate them for CKD cars. You don’t need a R&D department or development staff to do replication. National Car project helped these OEM autopart makers to develop their own IP and develop their inhouse skills to do R&D firstly for P1 & P2 and subsequently their expertise are seeked by other automakers today.

    Look guys, I think @… and I have made clear not all projects have to be ToT’ed but if it makes sense, not just considering the short-term but the mid & long-term effects, we shouldn’t be afraid to do it.

  31. @joe

    I feel that some of the readers have gotten pessimistic with the state of our defence industry lately. It’s as if there are no good news at all, ranging from Gowind delays, OPV delays and apparently even Lekiu CMS upgrades are facing some problems. All these while facing Covid and China’s intrusion into our waters.

    I agree that we should have some sort of domestic defence industry, things like bullets, rifles, pistols, or automotive engines shouldn’t pose any problems for us to support. There should be initiatives either from the MoST or MoD to push for further upgrade/development on current weapon systems ie M4.

    We are able to build tankers so patrol boats shouldn’t be an issue; granted corvettes and frigates are another ballgame altogether but MMEA OPVs should be simple enough.

  32. If the Koreans can built a corvette for less than $200 million (in this case $177 million without VL MICA) can we built the following batch of Gowinds at around $300 million without towed array sonar? If so why? Is it because the hull is so expensive? Seems like the CAPTAS 2 towed array cost $65 million while SMART-S mk2 radar cost $52 million
    https://klse.i3investor.com/m/blog/hwangdbs/28550.jsp

  33. … “Without the tax policy, there would be no automotive industry in Malaysia. Supporting our national cars is what created all these components manufacturers and designers.”

    The tax policy shields carmakers, P1 and P2, and allows them to charge buyers higher prices. But the component manufacturers who make parts primarily for export, are internationally competitive and not shielded. There is a 35% tax on imported automotive components but this is not what keeps them in business, seeing that they are export oriented.

    “And it is not done only by us. Imported cars in thailand for example are actually more expensive than in malaysia.”

    Nobody said that only we do it. Thailand is just one example, and even then only high end cars are meaningfully more expensive than here. The Thai price also includes lifetime road tax, they charge it at point of purchase instead of annually.

    joe “Perodua is thriving just by living off Malaysian market alone so its all about how much the marketshare volume, and we have overcapacity with P1 & P2 existing.”

    Still, P1 and P2’s cars are more expensive than they should be, because CKD and CBU competitors are taxed heavily.

    “The purpose of National Projects is to create these jobs. The cart don’t come before the horse.”

    The disposable income that NAP takes away from Malaysians in the form of taxes and high prices at P1 and P2, would otherwise be spent on other sectors and therefore support other jobs. At least those jobs would be economically justified and self sustaining, not in need of perpetual protection and bailouts. Just because these jobs are less visible and quantifiable, doesn’t mean they don’t exist.

    “Does it? All it needs is take the mould & design from the originator and replicate them for CKD cars. You don’t need a R&D department or development staff to do replication.”

    No, component manufacturing and CKD manufacturing do not need R&D but still create a lot of skilled engineering jobs. And as seen, P1 and P2 do not have enough revenue to mount a competitive R&D effort. They cannot do without licenced technology from foreign companies, and what they do licence is always generations behind. And we as end users pay a lot for it.

    “National Car project helped these OEM autopart makers to develop their own IP and develop their inhouse skills to do R&D firstly for P1 & P2 and subsequently their expertise are seeked by other automakers today.”

    You just said part makers do not need R&D, so why would any R&D expertise from supplying P1 and P2 be sought after by other automakers?

  34. @AM
    “P1 and P2’s cars are more expensive than they should be”
    Are they now? Certain models, perhaps. But a kosong C-segment Japanese car will cost upwards >RM100k either in Malaysia, Thai, or Indon while a Preve is far cheaper. Many would still buy the Japanese car because they have a choice and they can afford it.

    All jobs are important but its what the leaders then decided which direction the country goes to. Like India mass producing doctors & IT programmers, or Indon mass producing maids, labourers & planters, or SG mass producing financiers, bankers & traders, every country has their own direction and not all are smooth going all the time. Not all National Service projects are bad but like LCS program, it needed to start from a realistic base and constantly tweaked in adapting to changing circumstances. Certainly putting the right capabled persons in charge should be the priority.

    “create a lot of skilled engineering jobs”
    That could easily be replaced by a cheaper engineer in another cheaper country if they moved out or entirely replaced by automation. Ciplak-ing doesn’t last forever unless you add value and that’s where R&D comes in. And that brings me to the point below.

    “why would any R&D expertise from supplying P1 and P2 be sought after by other automakers”
    Because automotive is automotive, design and built to certain global or international standards. When companies like APM and such design & built parts for P1 & P2, they build on their R&D engineering ability. So instead of just outsourcing manufacturing to these local OEM companies, automakers could leverage on their lower R&D cost because an R&D engineer in MY is cheaper than a Japanese, you know. Of course other countries are muscling on this goldmine with their own cheaper skilled labour but its innovation thru further R&D that will continuously add value and keep the jobs here. In logistical line of trade too, the same. How to add value to attract customers away from traditional go-to SG, while keeping away upcoming hubs in Thai & Indon. Keeping in mind Selat Melaka also borders these countries.

  35. “Are they now? Certain models, perhaps. But a kosong C-segment Japanese car will cost upwards >RM100k either in Malaysia, Thai, or Indon while a Preve is far cheaper.”

    At equivalent specs, the Preve used to compete with Japanese cars that sell for 70-80k, which is the price after tax. But itself cost 70k+ for much lower quality. If the CKD Japanese cars were not taxed, they would be selling for 50k+ and the Preve would not be selling for anywhere near 70k+.

    “All jobs are important but its what the leaders then decided which direction the country goes to. Like India mass producing doctors & IT programmers, or Indon mass producing maids, labourers & planters, or SG mass producing financiers, bankers & traders, every country has their own direction and not all are smooth going all the time.”

    The point is these jobs are not economically justified because they depend on tariff barriers and to bailouts using taxpayer’s money to survive.

    “its innovation thru further R&D that will continuously add value and keep the jobs here”

    As we all know, the local market volume is not enough to support an R&D establishment at P1 and P2. They only survive by buying the licence to old technology from others.

    “So instead of just outsourcing manufacturing to these local OEM companies, automakers could leverage on their lower R&D cost because an R&D engineer in MY is cheaper than a Japanese, ”

    Sure we produce some human talent as a by-product, but making Malaysians pay import tariffs and pay for bailouts to keep P1 and P2 from going under, is a very expensive and unnecessary way to do it.

  36. @ am

    ” As we all know, the local market volume is not enough to support an R&D establishment at P1 and P2. They only survive by buying the licence to old technology from others ”

    You really have no idea what you are talking about… There are even R&D centers of other car manufacturers here in malaysia. Not to mention specialist automotive design concerns that can do engineering works for 3rd party manufacturers.

    http://image.isu.pub/130207130756-d963f05449db424cb4b043b3a3c783cf/jpg/page_63.jpg

    http://www.proton.com/en/corporate/about-us/research-development

    http://s1.paultan.org/image/2020/01/Perodua-2019-year-end-review-13.jpg

    http://img.icarcdn.com/autospinn-my/body/50948-img_20180516_102105.jpg

  37. Any updates on the SCS standoff? Have the CCG ships finally left the area?

    Just wanna know, is the Gagah Samudra class a suitable OPV for the MMEA?

    Reply

    The CCG is always there even if this particular one had fizzled out.
    Why should MMEA used a new design when they are already building another one

  38. I never said they should use a new design. I just want to know whether this class of ship is suitable to be used as a MMEA patrol vessel, as RMN had repurposed it to be used in a similar capacity in Ops Benteng.

  39. “And their answer is to create their own fishing militia too.”

    Options:
    1. Attach wooden bow (for rammimg) to vessel on fisheries protection tasking

    2. Attach fishing net/trawler net cutter to vessel on fisheries protection tasking

  40. nimitz,

    Some years ago Chinese fishermen speared and killed a South Korean coastguardsman. If you want to ram and cut nets, you’ll have to be prepared for close combat.

    There was also the case of an Indonesian ship impounding a Chinese fishing vessel. A CCG ship showed up and jammed the Indonesian comms, leaving them with no option but to release the fishing vessel.

  41. Actually we have options. Still remember we have converted certain merchant ships to escort other commercial vessels in the gulf n then used now in ESSCOM?.
    Singapore has bought one commercial ship n converted the front of the ship into a big space for 2 helicopters to land. Specifically this ship performs both a trainning function for Singapore Navy cadets n for helicopters to use as a patrol base.
    Its cheap , can be acquired quickly n armed eith small calibre guns n use to patrol our EEZ pending the.new LCS to be ready ( if it ever will).
    As for the new LCS just abandon it n buy them from overseas yards since our own BNS cant complete projects twice even though different management.

    Reply
    I wish it was that easy Lee, they have paid probably around RM5 billion – my estimates not confirmed – already for the ships. Even Mat Sabu said they already cut the steel for the 5 and 6 ships so their hands are tied. I think BNS did that to ensure that they could show progress for the project and get paid for that. Of course they could not get further payments for the first ship as it is already delayed.
    You cannot blame BNS for Kedah class delays however you cut it. You can blame them on LCS of course.

  42. @ marhalim, lee

    We have paid RM6 billion for those ships from the agreed ceiling price of RM9.1286 billion. It is said that additional RM1.4 billion needed to complete all 6 ships. Actually marhalim, you have reported it here before.

    https://www.malaysiandefence.com/condemned-to-repeat-it/

    Delays are sometimes not the shipbuilders fault. They cannot proceed when parts supposed to be paid for by government is simply not there.

    https://www.malaysiandefence.com/run-to-the-hills/

    BTW even if we close our eyes and stump out the additional rm1.4 billion now, the total price of the ship would increase by about usd55 million per ship, peanuts compared to the delay and non-availability of 6 very capable frigates if we dont put out the additional rm1.4 billion.

  43. “Singapore has bought one commercial ship n converted the front of the ship into a big space for 2 helicopters to land. Specifically this ship performs both a trainning function for Singapore Navy cadets n for helicopters to use as a patrol base.”

    What’s the name of this ship?

  44. Speaking of foreign fishing boats, I like the way the Indonesians is handling it.

    For our SOP we detain the so call fishermen/militiamen, tow back the fishing boat to local MMEA pending for court case. Apa susah susah, just blow it to smithereens like how our neighbour is doing!

    Reply
    No lah they also got court order to blow them up, we take things that can be used, while the hulls, if not up to standard are scuttled as artificial reefs which is cheaper than blowing them up

  45. If need be as work jas been done on the two hulls but BNS cannot work on the rest we take back the steel alrady cut, retender to other qualified yards to build n complete the rest of the hulls. Let the first two ships to be settled by BNS

    Reply
    Four actually already built in various parts of completion.

  46. Great lets add another 50m for each ship to make it 500+m perunit..500m for a 3100 tonnes ship and its not the best in the region yet..unmatched planning ha ha..that 50m pership additional cost better put into arming the kedahs tbh..

  47. @Firdaus

    “Great lets add another 50m for each ship to make it 500+m”

    At first when I saw your comment I thought you’re talking about extending the length of the ship to become 500+m(eter)! I thought where can we find a ship that’s longer than a Nimitz class… haha…

    Now maybe everyone smarten up, especially all the shipyards contracted to build all these megaship (almost Queen Mary II equivalent)
    Just agree at whatever price first, later on give out tonnes of excuses to jack up the price. What to do, ‘minyak’ tak de, ‘enjin’ tak jalan… you know what’s the minyak, and who’s the enjin here.

    Knowing that this is the ‘National service project’ that the government will never cancel and no one will be in trouble, it’ll be ‘unwise’ not to do like that…

  48. @ firdaus

    So it is better to create a rm6 billion scrap metal and arm the kedah opvs rather than having 6 additional new frigates for the same rm1.4 billion budget?

  49. Taiwan Launched a 600 Tons Coast Guard Cataraman That Can Fire 16 ASM

    https://www.navalnews.com/naval-news/2020/05/taiwan-launched-a-600-tons-coast-guard-cataraman-that-can-fire-16-asm/

    I thought my concept of OPV + grenade launchers +MG was wild one (I thought it was reasonable, but others believed otherwise), but this one really takes the cake. Granted it’s probably due to China’s increased pressure on Taiwan and a rumored naval exercise involving two PLAN carriers.

  50. “Granted it’s probably due to China’s increased pressure on Taiwan and a rumored naval exercise involving two PLAN carriers.”

    Actually, these are simply FFBNW versions of the Tuo Chiang catamaran corvette. One fully armed hull is in navy service and these follow on units were planned some years ago. In peace time, they will serve with the coast guard. They will be transferred to the navy and fitted with missiles in periods of tension.

    The China coast guard also has Type 818 cutters based on the Type 054 frigate hull and these can be armed.

  51. Well of course not..So u just okay with that 50m additional cost per lcs?..Figures..Do u really okay wity that rudonculous unit price for lcs?..And like ive mentioned before our projected lcs is no better than formidable and maybe htms ba too..

  52. @ firdaus

    It is of course not okay, but is way better than creating rm6 billion worth of scrap metal like you propose. Mistake has happened, what we need is to rectify it, not pretend it did not happen.

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