StarBiz reports Proton shares have dropped from RM8.35 to RM7.90, making it the second highest loser on the Bursa Malaysia yesterday.
Traders was worried by the announcement that Proton was interested in buying two Volkswagen platforms to rush out the production of 2 new cars to curb falling sales. They said it made no sense for Proton to buy the platforms since they were heading for a technical collaboration or stake transfer in the first place. This implicated the collaboration might not happen.
HLG Research has flagged Proton shares as buy, as these shares are expected to soar up later if any announcement / further development of an alliance with Volkswagen AG.
HLG analysts also believe that the Q1 loss is partly caused by MV Augusta, which is expected to turn around only in 2007. The report also said Proton also carried 30,000 cars in stocks (these are the ones you see in photos of Proton stockyards) which would affect earnings if not cleared by year-end.
There’s new colour option for the Proton Savvy on the road. Looking back at my blog comments, one of my readers had already seen it as far back as early September. I saw one for the first time this morning at Taman Connaught. The colour is something like a metallic apple green, something like the Perodua Myvi’s. I have a photo of it at home, will post it once I get home. At the office now. There were five colours if I remember. We know four now. I can’t remember the other one until I get home. *frust*
The Edge reports that Proton is looking into purchasing two Volkswagen platforms to produce it’s own versions for the local market under the Proton badge. After the purchase, design and development would take an additional year.
Another MP has spoken up on the issue of Proton. Deputy Minister of International Trade and Industry Datuk Ahmad Husni Hanadzlah said that Proton has to update it’s models more frequently as with accelerated product releases by other manufacturers these days, their products go out of fashion more quickly.
The Government encourages Proton to use as much local content as possible to develop the parts and component industry. This is also vital to achieve and maintain quality in Protons range of cars and for competitive pricing. Our car industry must have quality. Where it wants to source its parts from, that is up to Proton, but we encourage the use of local content. It’s up to Proton to decide the proportion of local content in it’s cars.
Well then, since according to Datuk Mah it’s not a government imposed rule, let’s see if Proton takes this path in the future as part of it’s struggle to improve it’s competitiveness. Datuk Mah agreed with Shahrir that automotive vendors who could not be compettive after 20 years should increase quality and competitiveness or close down.
Datuk Shahrir Abdul Samad, chairman of the Backbencher’s Club says if high local content is making Proton not competitive, local content should be reduced.
“If AFTA requires only 40 percent local content, there is no need for us to go up to 90 percent, unless it makes Proton cheaper and more competitive. We have to make a rational decision. If our cars are expensive due to high local content, we need to reduce the price by reducing the local content. They have already been operating for more than 20 years. If the quality of their products is still not up to standard and cannot be exported, they should close down. If they are still not efficient, they should not be in this industry.”
The problem with our locally manufactured components is likely lack of volume which drives component prices up. We also have the problem of incompenent component manufacturers making components without proper QC. I’m sure any Proton owner curses the car’s air cond vents.
If Proton is to be truly competitive, such social responsibility towards local vendors should not be imposed on them. They should be free to source for components anywhere in the world they want, as long as it makes sense. This should give the local components manufacturers a kick in the ass and hopefully they buck up.
I know many of you will be excited to see this as there has been no SRM spyshot updates in a long time. These Proton Satria Replacement Model spy photos were captured by spy auto photographer Hans G. Lehmann in England going through test rounds. It’s covered with black tape. And with one look, you can see it’s turbocharged!
Proton and EON’s board have sent statements to Bursa Malaysia that their directors and major shareholders were not aware of any decision of Proton wanting to buy DRB-Hicom’s stake in EON.
An unnamed industry source says that Proton may buy up DRB-Hicom’s 29.3% stake in car distributor Edaran Otomobil Nasional Bhd (EON).
The source said Proton may start with buying up DRB-Hicom shares, then proceed to buy up other stake held by government through the EPF and Khazanah Nasional which owns 12% and 6.2% respectively.
The plan is to eventually combine Proton Edar and EON.
StarBiz reports Proton shares have dropped from RM8.35 to RM7.90, making it the second highest loser on the Bursa Malaysia yesterday.
