SPANK SPANCO AND THE GOVERNMENT

New cars for the force: The Kedah police contingent headed by its chief Datuk Zainuddin Yaacob checking out some of the vehicles by Spanco at a handing over ceremony recently at the Kedah police headquarters. Spanco is the incumbent vehicle fleet contractor holder for the government. - Bernama

This is from The Star here.

Long-term govt contracts highly sought-after business

tender to manage vehicles attracted biggest automotive groups in country

15-year concession worth RM300mil from fifth year onwards ??

manage fleet of vehicles – used by ministers, govt officers, department, police

size of the contract varies from year to year, depending on fleet requirement

Spanco expiry of 25-year contract in December

govt require at least 32 new Toyota Vellfire for ministers 
These luxury minivans to be replaced every four years

also 3,000 Honda Accord for higher-ranking government officers

1,300 mobile patrol vehicles over five years
8,000 Proton Persona and Saga 
around RM1.5bil over five years to purchase new vehicles
 
govt pay monthly rental for each vehicle 
amount excludes fixed monthly bill for repairs, maintenance 

Spanco secured contract in 1994
each vehicle leased for five years, before replaced with new car

end-to-end fleet management with five-year replacement keeps fleet current

ensuring maintenance cost of vehicles capped 

“We provide unlimited repair and maintenance services for the fleet to ensure that a maximum number of cars are always on the road, ” Spanco’s chief executive officer Datuk Hamzah Mohd Salleh said.

Spanco buys, on average 2,000 - 3,000 vehicles a year
Spanco spent over RM2.5bil on new cars during contract 
A lot of money goes towards purchasing new cars

company has two flagship service centres in Batu Caves and Bangi
supported by network of over 200 workshops 

OSTB : 

• Nauzubillah. What ??
• This is a total ripoff. How stupid can the government be? 
• The govt pays the 'car management company' to maintain the cars. 
• And what does the car management company do? 
• They send the cars to Ah Fook the roadside mechanic shop who does the real service and maintenance.  
• It is just adding another layer to the govt's expenses - burning up taxpayers money.

The govt has the cars.
You collect the cars from the govt and send them to the mechanic.
The mechanic charges you say RM100. 
You charge the govt RM200. 
You pocket the difference RM100.


What value added skills has Hamzah Salleh learned as a CEO of Spanco? He has learnt how to :

collect cars from the govt, 
collect RM200 from the govt 
send the cars to Ah Fook the roadside mechanic, 
pay Ah Fook RM100 and 
pocket the balance. 


That is why our economy is not moving. 
There is little value added. 
There is little new wealth creation. 

Just add an extra and useless layer to existing economic activity with no value added. Then expect our economy to grow, expect our economic output to catch up with South Korea, Japan, Germany, Singapore etc. 

(adapted after OSTB)