Former premier Dr Mahathir Mohamad has warned that if Malaysians don't support local industries, including Proton, then Malaysia will become a failed third world country.

Mahathir, who is Proton adviser, said buying foreign cars will only benefit foreign economies.

This, he said, will actually lead to a situation where Malaysians can no longer afford to buy imported goods.

"Assuming that all local industries are closed, few will have money to buy imported things. We will revert into being a failed third world country.

"(But) when you buy a local car, money stays in the country, workers earn money, dealers and agents and their employees enjoy the business they do and the local economy grows. Thousands of families enjoy a good life," Mahathir ( photo ) wrote in his blog today.

On perception that local cars cost more than they are worth, Mahathir said this is not the fault of manufacturers, but the government.

"Taxes on motor vehicles are what caused the prices to be high. But the government need to tax motorists because of the roads and other infrastructures that government has to provide," he said.

He also touted Proton's advancement over the years, saying the quality of local cars is now much better than before.

He pointed out how Proton is currently developing a new engine to replace the decade-old Campro.

The new engine, Mahathir said, should be available in Proton cars by late next year.