‘GEELY CAN PUSH PROTON PRODUCTION, BRANDS’
Chinese automaker has proven track record, says minister
THE acquisition of 49.9 per cent stake in the national carmaker Proton by Chinese automaker Zhejiang Geely Holding Group should be viewed from a business angle and not anything else.
In response to a posting by Tun Dr Mahathir Mohamad, Second Finance Minister Datuk Seri Johari Abdul Ghani said Geely had a proven track record of rescuing renowned Swedish automaker Volvo.
He said Geely could do the same for Proton, especially in maximising the capacity of its manufacturing plant in Tanjung Malim, as well pushing Proton brands into the regional and global markets.
“Although the 32-year-old national carmaker has the capacity to produce 400,000 vehicles due to underutilisation, it is currently being utilised below 20 per cent.
“At its peak performance, Proton sold up to 180,000 units (per month).
“At present, its sales hover around 6,000 units monthly,” he said after presenting a hearse to Masjid Al Akram here.
“If we love Proton, we have to think about the wellbeing of its 10,000 employees as well as another 50,000 vendors and suppliers. Proton’s employees, vendors and suppliers will lose their jobs if Proton is no longer competitive and has to be shut down,” he said.
He said Proton had made a loss of RM650 million in 2015 and RM1.5 billion last year. If this persisted, he said, the government could not provide financial assistance to Proton as it used to.
“If we do not revise, restructure, and bring in the latest expertise and technologies to Proton, it will lose its competitive advantage. We do not want Proton to meet the same fate as the defunct steelmaker Perwaja Holdings Bhd.
“Perwaja was once a national pride, but when it discontinued its business, its employees were retrenched and manufacturing plants were closed.
“Although Proton is dying, its has yet to conduct a retrenchment exercise.
“If we had not done this (the acquisition), it would have shared the same fate as Perwaja.
“This is why we allowed DRB-Hicom to search for a strategic partner to rejuvenate Proton, so it is able to recover the vehicle’s production volume and increase its total output.
“We aim to make Proton the top brand in Malaysia and export its vehicles outside the country including Asean, China and other countries in Asia,” he said.
The final agreement will be signed by both parties no later than July, and it will take six months to complete the acquisition process.
“In the long run, Proton’s sales will increase and its vehicles will be able to penetrate Asia, including China, which could reach 500,000 units,” Johari said.
On Thursday, Dr Mahathir lamented Geely’s acquisition of the 49.9 per cent stake in Proton.
Dr Mahathir, who is former Proton chairman, said the sale of Proton’s stake by DRB-Hicom Bhd to the Chinese carmaker was probably the beginning of an “inexorable process”.
“Proton has been sold. It has been sold to foreigners.
“They say Proton is my brainchild. Now the child of my brain has been sold.
“Yes. I am sad. I can cry. But the deed is done...
“We, Malaysians, are glad to be rid of this pesky car,” he said.