So far, Proton parent company DRB-Hicom has showed no interest in relinquishing its majority stake in the national carmaker, but even if it did, the government has claimed that it has no issue with it doing so as a means to pursue a foreign strategic partner (FSP), according to Bernama.
The national news agency quoted second finance minister Datuk Seri Johari Abdul Ghani, who said it would rather have a Malaysian carmaker become a well-known international brand, instead of simply selling cars to the domestic market with a volume of between 200,000 to 300,000 units, which he said is unsustainable. “The key is to bring many investors to Malaysia and create employment,” he said.
Johari added that as Proton was no longer state owned – and the government had no intention in buying back a stake – there was no harm in it proceeding with its plan. He also said that it was privately owned, and as a result, a government intervention in the company’s dealings would be wrong.
On the flip side, Johari said that the government could still have its own opinions regarding the negotiations, adding that Proton needs a foreign partner to provide it with new technologies and introduce better cars that consumers from other countries would buy.
“If Proton is to stand alone, it cannot flourish overseas,” he said. “We are making cars only for Malaysia and this is not sustainable with a population of only about 31 million. We also have Perodua and other car assembly brands. I think it is all about volume, as well as quality and technology, alongside a good design. These are all the ingredients needed for a better car which people would buy.”
Johari also said that while Proton is a good brand, it needed to have more volume by selling cars overseas and introducing new models. He also said that one or two “good” local partners have shown interest in partnering with Proton by buying a stake lower than 50%. Although the minister declined to elaborate further, he advised those looking for a partnership to express their interest before February 15.
Additionally, Johari said that the government is concerned with Proton which he said has created thousands of jobs, although it has no interest of being involved in private sector dealings. “There is a need to ensure this job security and that vendors are protected,” he said. “Going forward, the government should allow the private sector to do business, but won’t itself be involved in it.”
Earlier in the week, DRB-Hicom issued a statement regarding the partnership negotiations, saying that it aims to complete the selection of an FSP by the first half of the year. With the interested parties – reported to be Geely and the PSA Group – having already completed their due diligence on Proton, it now awaits the submission of bids from the parties, after which an evaluation of the bids will commence.
The conglomerate also stated that Proton can be a more successful carmaker with a partner, gaining access to new platforms, powertrains and technologies that will allow it to revitalise itself. Group managing director Datuk Seri Syed Faisal Albar said that DRB-Hicom will evaluate three key criteria – which are the strategic, operational and cultural fit – in finding the right FSP for the Malaysian carmaker.
Syed Faisal added that DRB-Hicom will insist that the Proton badge and its technology will be expanded into ASEAN markets first and global arena subsequently, and will also assess the intention of the potential partner in utilising the current “home-grown” vendor network during its evaluation.
He also said that the company is confident the venture will be beneficial to all parties, with the FSP gaining access to Proton models, the under-utilised Tanjung Malim plant and the research and development expertise of Proton and Lotus.
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AI-generated Summary ✨
The comments reflect mixed reactions regarding Proton’s stake sale and future prospects. Some express concern over government loans and control issues, emphasizing the importance of control and strategic decision-making. Notably, critics highlight Proton’s historical struggles with quality, outdated designs, and lack of innovation compared to competitors like Geely and Hyundai. Several comments praise recent Proton models like the Saga and Persona but criticize certain design flaws and cost-cutting measures. The potential partnership with Geely raises worries about workforce reductions and loss of local control, with some arguing Proton should focus on niche, eco-friendly vehicles instead of global expansion. Overall, opinions range from skepticism about the sale’s impact to hopes for Proton’s improved focus and quality.