National carmakers shift to top gear for smoother ride
KUALA LUMPUR: Malaysia’s car industry is set for a smoother drive with both national carmakers, Proton Holdings Bhd and Perusahaan Otomobil Kedua Sdn Bhd (Perodua), shifting to top gear to become more robust and competitive. cent equity in Proton Holdings worth RM460.30 million. The Chinese car group also acquired a 51 per cent stake in British carmaker, Lotus, which Proton has owned since 1996.
“The car industry was positive in reacting to the announcement by DRB-Hicom to sell 49.9 per cent of its equity to Geely on May 24, 2017.
“Many understand the need for Proton to have a strategic partner to overcome its main challenges including a decline in domestic sales, limited export market, lack of economies of scale and investments in R&D and technology,” said Mustapa.
However, there are concerns from local car industry on the impact of the strategic partnership to local vendors, especially once the business restructuring of the partnership takes place.
Proton has about 240 vendors, with almost 50,000 employees in its direct supply chain.
“Nevertheless, DRB- Hicom has given an assurance that in selecting Geely as its partner, it has taken into account all such issues, including the impact on local vendors.
“While local vendors are still expected to meet stringent quality, cost and delivery measures to ensure the competitiveness of Proton, they are also open to other opportunities created from the partnership.
“These include technical cooperation to enhance capabilities,
The partnership will allow Proton to tap into Geely’s technology and R&D facilities including a range of platforms and power trains. More importantly, it could fully realise the potentials of its production plants.
possible participation in Geely’s supply chain and being able to export regionally,” Mustapa explained.
On whether the local car industry was considered to be liberalised with the Proton-Geely tie-up, he said, the industry was already fairly open and liberalised under the National Automotive Policy 2014. Turn to Page B2, Col 5
Datuk Seri Mustapa Mohamed, Minister of International Trade and Industry