Naza Corporation Holdings and Groupe PSA have announced the signing of a share sale agreement and a joint venture agreement, officially establishing shared operation of the Naza Automotive Manufacturing (NAM) plant in Gurun, Kedah as the first manufacturing hub in ASEAN for the French carmaker. The signing was witnessed by prime minister Datuk Seri Najib Tun Razak this morning.
With the agreements in place, the French maker of Peugeot and Citroen (Europe’s second largest carmaker after VW, now in control of Opel/Vauxhall) will hold majority stake in the business operations of NAM. The stake is reportedly 56%, with the sum undisclosed. The Naza Group will have sole responsibility for the distribution of Peugeot, Citroen and DS brands in Malaysia. With PSA, it will explore distribution prospects in other ASEAN markets.
According to Naza, the NAM plant has been operational since 2004, has a workforce of close to 450 people and has a production capacity of 50,000 units per annum. NAM is expected to become PSA’s export hub for the region, with forecast volume of 18,000 units in 2019 and 21,000 units in 2020.
PSA’s investment in NAM will see the implementation of its EMP2 modular platform dedicated to C and D segments – the first models to be produced in Kedah will be the Peugeot 3008 this year (currently sold here as a CBU import) and the Citroen C5 Aircross in 2019. The latter is a funky SUV that was unveiled in April 2017.
“The creation of the ASEAN hub in Gurun, Kedah is a significant leap forward for Groupe PSA which will lead to the development of a profitable business in the region as part of our Push to Pass strategic plan. We are pleased to partner with Naza and continue leveraging our historical relationship,” said Carlos Tavares, Groupe PSA chairman.
“We are grateful for Groupe PSA’s support and confidence in Naza as we take our longstanding partnership to greater heights. With this collaboration, there is enormous potential for Kedah to be the leading automotive manufacturing hub in Malaysia,” said SM Nasarudin SM Nasimuddin, group executive chairman and CEO of Naza Corporation Holdings.
The deal is a win-win for both parties. Naza has reportedly been keen to get its principals – it assembles for Peugeot and Kia – to take a larger role in the car business in Malaysia and ASEAN, and have equity partnerships with the local group.
The PSA Group’s appetite to expand in our market and region is well-known – the French carmaker was in the running to be Proton’s foreign partner before Geely was eventually chosen. Proton’s large but under-utilised Tanjung Malim plant was what both interested parties were eyeing. Now that PSA is in charge at Gurun, it remains to be seen if the plant will continue to assemble Kia cars.
GALLERY: Peugeot 3008 in Malaysia
GALLERY: Citroen C5 Aircross
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Peogeot please don’t be lazy with your conversion to RHD & reposition the fuse box instead of having it inside the glove box !
(Like) 2018 Boyue.
(Dislike) Peugeot 3008
Last year, many were skeptic of Geely, they thought Geely was some shady, copycat sweatshop style chinaman enterprise. Some criticism were very racist in nature. So they’d rather PSA take ove- i mean partner with Proton.
To all those haters, this is the chance to see if you’re a man of your word. Will you support PSA/Naza? Or chicken out since plenty owners have nightmare stories about their ownership experience? Good luck!
Meanwhile, Geely moves forward, and so will Proton, I’m sure of it. Thank God there were still intelligent and sensible people in DRB-Hicom who made the right choice.
Geely, Bao Teng > all
Nah, PSA is looking at a larger picture. They want to make LHD cars too for Vietnam and the Philippines since there are no more barriers within ASEAN AFTA.
And pls oh pls PSA – bring back Vauxhalls to Malaysia. Get Naza to convert the Chevrolet dealership to Vauxhall (should have been done when both brands under GM).
To other ASEAN countries they can opt for Opel badge. No problem. Basically same car.
What does it mean by ASEAN hub? All CKD in ASEAN will be in Gurun? What about Peugeot LHD plant with THACO Vietnam? Will all the manpower in Gurun stay put?
thaco is basically using all manual labour to assemble and paint the cars, in limited numbers. something like 2 cars a day. not worth to invest in automated factories to manufacture 50 cars a month. besides, Gurun plant may make 5 model where else Vietnam only 1 specific model. the rest would be CBU then.
nak buat kilang juga la.. tunggu tunggu 13 tahun VW akan beli.
Any chance of exporting to Indonesia?
all asean countries. no import tax. faster parts supply. 10 countries. target 20k units a year capacity. on average 2k units per country per year.
So what happen PSA plan earlier to produce car in Vietnam 2018?
Red herring move to pressure gov sell P1 to them instead.
Pls add front passenger electronic seats and sunroof
Kalau dulu p1 jual kat naza, tak jadi macam sekarang. Drb ni sikit2 guna duit rakyat, masa rugi ceo still dapat bonus. Apa pun tak boleh pakai drb ni
Nk buat apelagi… Drb audi pon dh tenat skrg
This is big news ! Congrats to Naza and Peugeot / PSA Group on this milestone in their 15 year-partnership.
Having the brand principal (Peugeot) financially involved in the manufacturing operations will add stability and weight to the joint-venture. When the principal owns part of the plant, they will want to see it grow even more (since more money is involved, and the stakes are raised). The distributor (Naza) can focus on sales and aftersales, while the principal takes care of manufacturing.
Most local-foreign joint venture plants in Malaysia follow this business model to some extent. Here’s the ownership structure (the ones I’m aware of at least) for the major local plants ;
Perodua Manufacturing – Daihatsu owns 51% +
Perodua Global Manufacturing – Daihatsu owns 51% ++ (possibly 60% +)
Proton Tanjung Malim – Geely owns ~ 50%
Assembly Services- Toyota & Toyota Tsusho jointly own 49%
Honda Malaysia – Honda owns 51%
Tan Chong Motor Assemblies – Nissan stake negligible. Mitsubishi, Subaru and Renault have no stake
Mazda Malaysia – Mazda owns 70%
Inokom – Hyundai owns 15%, BMW stake undisclosed
Mercedes-Benz Malaysia – Mercedes-Benz own 51%
Volkswagen Pekan Plant – ? Undisclosed ?
Isuzu HICOM Malaysia – Isuzu subsidiaries own 51%
Volvo Car Manufacturing Malaysia – Volvo Car owns 100%
Go Auto Manufacturing – Haval has no stake
Oriental Assemblers – Chery and Chana have no stake
Naza Automotive Manufacturing – Kia, Peugeot/Citroen have no stake (up to Feb 2018)
A brief recap of Naza’s recent history ; Naza’s heyday of cheap rebadged Kias and Peugeots have come and gone (early 2000s to early 2010s). It’s hard to believe that at one point in 2006 or so, Naza had sought to buy out Proton (which was then in talks with Volkswagen). Had Naza’s founder (SM Nasimuddin) not passed away of cancer (in 2008), Naza would have become a major player in Malaysia today. But with his departure, the Naza ‘magic’ vanished too. Nasimuddin’s sons (who took over Naza’s management) managed to keep Naza in the green initially, but by 2013 or so, Kia and Peugeot sales had nosedived. Naza tried to move Kia upmarket (they are pushing sales of the SUV models), and to their credit they somewhat succeeded, but Kia is no luxury brand, and they need bigger sales volumes to survive. Peugeot has fared worse overall. Naza tried pushing the Citroen brand too, but that didn’t work either. But I guess virtually every mass market Euro brand in Malaysia (VW, Ford, Renault, Peugeot etc.) has been on the decline in recent years.
A brief history of Peugeot in Malaysia ; Peugeot is one of the oldest players in Malaysia. Back in the late 1960s, Peugeot built their first Malaysian plant, Asia Automobile Industries (AAI) in Petaling Jaya, together with Toyo Kogyo (Mazda’s owner) and Asia Motor (Penang-based local franchise holder). Peugeot assembled quite a few models here, and one of their top models back then was the 504.
Sometime in the 1980s, the local Peugeot franchise switched from Asia Motor to a small company called Ibis Automobile, bit they didn’t last long, and the MBf Group got the franchise shortly after. During the MBf era in the 1990s, the 405 was a popular model, and it was assembled at the Oriental Assemblers plant in Johore.
Then in 2002, Cycle & Carriage took over the Peugeot franchise from MBf, but unfortunately, it only lasted a few years and in 2008, Naza got the Peugeot franchise (Naza already had business relations with Peugeot since 2002). It was under Naza that Peugeot really witnessed a renaissance with strong sales of the 206 Bestari and 207, and the 408 sold well too. Naza also assembled a wide range of Peugeot models at their Gurun plant.
Peugeot has regarded Malaysia as their ASEAN hub since the 2000s, both from a sales and production standpoint. Now, Peugeot has taken one step further to become directly involved in the local operations. Although Peugeot sales have been slow in the past few years, and quality and aftersales are still question marks, I think Peugeot has the potential to do well in our market, if the bring in the right products. Any SUV model will be good. The new 508 also looks fantastic. And maybe Peugeot can bring in some of their China-exclusive models, since the Chinese-made 408 did so well for Peugeot locally. The Peugeot 301 small sedan also looks like a good fit for Malaysia.
Anyway, good luck and congrats again to Peugeot/PSA Group and Naza on this latest development. Hoping to hear more details soon. Even though I’m on the ‘other side of the fence (I stand with Proton-Geely Boyue)’, I know the 3008 is also a great SUV. But most of all, I value the auto industry as a whole; if one company does well, others will too. Why ? Because virtually every local plant gets their parts and components from the same few vendors (there are 600+ Malaysian vendors). The health of the local auto industry depends on the competitiveness of our local vendors. Our E&E industry is also playing an increasingly larger role in our auto industry, as cars become more and more computerised and electronic. So we’re all in this together. This is the big picture, the grand plan.
Buy perodua better. X payah fikir x payah pening. Beli je..
With the eventual merging of Naza & Berjaya groups, they can combine both Pijot & Mazda under 1 roof.
Aero ,
Your write up is very refreshing to my past memories .
Let hope Peugeot return to glory days of the 60s and 70s by not making any more sub standard and problematic cars of the late 80s, 90s and 2010s further.
The peugeot 404 and 504 were great cars which was not only very tough but very comfortable to ride on.
Let’s hope Peugeot employed the right Engineers and Designers to rejuvenate the brand that was once known to be tough with legendary comfort.
Good, pls do more testing for local units. Peugeot owners cakap it is nice to see but never cheap to maintain
Very good writing Aero. Indeed. I hope to see more comment like this instead of bashing left and right from redicolous basher
Very well summarized. I am a Peugeot owner and I believe that even with small problems which every European mass market brand faces in Asia, Peugeot can win the Malaysian Market share with better cars. For this, Peugeot should contact and listen to people like me who are using Peugeot in Malaysia for the last 7 years.
Bring the R&D team here too. Several unique points need to be address (glove box too small, signal light positions, etc)…
Spec varians. Don’t be cheapskate to the spec and equipments. Spec we getting here are low, and no customization option, no sun/moon roof, etc… To win people heart, be generous on specs and people will loyal to your brand.
After sales service improvement. People love free things (free labour service, appointment door step pickup…).
Market the selling points and up lift the brand so rakyat would feel the confident to own.
PSA should takeover the aftersales too. That is the biggest problem really.
PSA should not only focus on manufacturing and sales but at the same time have to upgrade the showroom as standardized showroom because as what I known Peugeot showroom in Ipoh is really worst and fit with the brand class.Peugeot cars is really good no complain about it but however it good but platform is worst no use.
PSA should not only focus on manufacturing and sales but at the same time have to upgrade the showroom as standardized showroom because as what I known Peugeot showroom in Ipoh is really worst and not fit with the brand class.Peugeot cars is really good no complain about it but however it good but platform is worst no use.