More on Proton’s search for a foreign strategic partner (FSP). Reuters reports that Zhejiang Geely is expected to bid – as early as this week – for a strategic partnership with the national carmaker, according to a couple of insiders with knowledge of the bidding process.
The sources told the news agency that the Chinese automaker has pitched to DRB-Hicom that it will offer Proton some of the latest vehicle technologies it has developed with Volvo’s input as part of the deal.
These include that used to design vehicles such as the automaker’s GC9 sedan and Boyue SUV, as well as small car tech developed with Volvo, the sources stated. They added that by offering Proton some of its own technologies, Geely is looking to break into right-hand-drive (RHD) markets, tapping it via Proton.
A significant partnership with Proton would give the Chinese firm entry into the global RHD market. “There are eight million RHD vehicles sold every year globally. Geely sells roughly zero RHD cars, so even if Geely cars were sold under Proton, if nothing else Geely would make a handsome license fee,” one of the sources explained to Reuters.
According to the source, the Chinese company’s investment would help Proton grow its exports and recover some of the global presence it has lost in recent years. “The overall plan is basically to invest in Proton to bring it back to global levels (of sales) it had in the 1990s,” the source added.
There was however no indication on whether Geely’s pitch – which the sources said was part of the final bidding round – included a cash offer for a stake in Proton. They added that Geely is looking for at least a 51% stake in the Malaysian carmaker.
When contacted by the news agency, DRB-Hicom stated it had nothing new to say. “We are evaluating the bids received. No disclosures until we have selected a FSP,” a spokesman said. Meanwhile, Geely declined to comment on the speculation.
Reports have placed Geely and France’s Groupe PSA as leading parties to become Proton’s partner. Last week, DRB-Hicom reiterated that it was presently focused on going through the critical process of identifying the ideal partner for the national carmaker.
It added that it would conclude and formally announce its partnership decision – which will also include the merger of the company’s plants in Tanjung Malim, Perak, and Shah Alam, Selangor – by the end of 1H2017, striving to complete the task as early as possible.
Earlier today, the government – which has stated that it will not intervene or be involved in the FSP decision, since the automaker was no longer state-owned – quashed rumours that Proton will sell 51% of its shares to a foreign partner.
Second international trade and industry minister Datuk Seri Ong Ka Chuan said a final decision has not been made. “The government is not relinquishing the country’s proprietary rights. We are looking at the opportunities to help Proton grow more efficiently, so that it will be on par with other big brands in the global car industry,” he explained.
Previously, the government had said that it had no issue with DRB-Hicom relinquishing its majority stake in Proton. Meanwhile, DRB-Hicom had earlier said that Proton would remain very much a national carmaker, and has repeatedly stated that it will maintain a significant equity in Proton.
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To bring back proton to its level in the 90s proton to has to this.
1. Do not allow any car companies to sell any car below 100k. Yes, right. Vios and city and cerato all must sell at 101k.
2. Do not allow perodua to sell any car bigger than axia. Again, that’s right. In the 90s perodua only had kancil and rusa van in its line up.
Geely will win this deal. But Geely is only 18 yrs old. Geely actually started in 1998.
PSA and Peugeot started in the 50s.
So who do you think has more tech? 18 yr old company or 70 year old company?
Now, I wonder why Geely will win over PSA
Chinese learn fast unlike its other Asian counterpart like wait for it.. Malaysia. I used their Maglev train a couple years back. It was fantastic considering it was indigenously designed from scratch. Now the question is how desirable are their tech? Volvo to start with aren’t a tech savvy company until these few years. I for one think PSA is more suitable for Proton because after all they are Continental cars. Wouldn’t mind driving a rebadged Continental car. But we all know, Proton belongs to Geely. Was kinda happy when I read that Geely wants Lotus and PSA wants Proton. We all know how things can turn out. Whatever the majority wish for, the opposite would turn out to be true. We should reverse psychology it by wishing that Geely would acquire Proton.
age is just a number. PSA’s already has a global market for all of their products, why would they push Proton cars and eat up their own market share? Unless Proton has something to offer, at the end of the day, they will always focus on Peugeot. Just like how Ford did not promote Volvo, Jaguar and etc.
Geely on the other hand is new to the game, and they do not have global market share, thus they ‘might’ delegate Proton as their SEA market leader, just like how they are push Volvo for Europe and USA market, knowing well they do not have the reputation as a Chinese brand to even penetrate 1% of those market.
age is just a number.
Not a surprise Geely will win the deal with all cash they can put in
Just because PSA exist longer doesn’t mean it is better as a carmaker. You do know that Geely owns Volvo, right? And Volvo has some of the latest powertrains, autonomous techs and not forgetting safety techs in the market. Geely provided the financial muscle for Volvo’s recent renaissance. Your insinuation that some form of corruption may get involved in the bidding process is moot at best unless you can provide some proofs.
“Potong” what r u thinking? It is Money that makes the world spins! U cannot fancy/afford Mat Salleh/angmoh style business luxury anymore! Like others said earlier “beggars pls don’t choose”
Actually…geely does sell some rhd cars…they have a few dealers here in Indonesia
We believe that eventually Geely will get the deal.
Then use Lotus name horribly
Well, they are doing well with the Volvo name so far.
P1 need to double up effort to revive their model line up…please do not depend on other manufacturer’s technology to survive…sudah-sudah la…is it enough to fight globally just with current models and design?…
So you think P1 can come up with anything new? How much did they spend in R&D per year? How much do other Marques spend in R&D? Every manufacturers are joining forces by pitching in their own effort : MQB chassis (VW group), Renault-Nissan Alliance (electric technology), Toyota-BMW (next gen sports car) and the list goes on and on. If the big boys have to cooperate in order to survive you reckon a small player nobody player like P1 can survive the onslaught with existing work culture and ethics? As of today they are still making cheap plastic junk with minimal safety features and sold in a market whereby all other cars are taxed to the Max.
Minimal safety feature? OMG I can’t even…
Dont sell to geely. It is just a deep s#+T
What makes you so sure?
Are you forgetting that Geely is responsible for Volvo’s recent renaissance?
There’s so many inconsistent statements, especially on behalf of the government. TheStar kept on depending ‘insider’ speculations (first said Geely is in the lead, then said just interested in Lotus), while DRB-Hicom is keeping its lip tight. At the end of the day, someone going to profit from the share market.
Don’t dream so high that Geely is going to share Volvo’s tech. All they see is profit from licensing (rebadge) & penetrating ASEAN market. They are less concerned on technological transfer and human capital development. “Habis madu, sepah dibuang”. Selling majority stake to PSA Group is the only reasonable option for Proton to return to black.
No no no … latest technology is good but it’s 2nd important, we want Volvo quality. That’s top priority. So are the Service center quality we want Volvo quality. Show us this and when we’re convinced we’ll pay you Volvo price.
Excellent. Make it happen.
Geely > all
Volvo > all
Where got money to “double up effort”?
Every year also rugi, can tahan meh?
Well according to other sources the final outcome well be very surprising..ie there are news that Geely wants Lotus while PSA wants only Proton (not only Tajung Malim but the Proton brand)…Yes I think most Malaysians were 100% Sure that it was the way around Hahaha …PSA even said they not even interested in Lotus, saying that they are more likely to expand in the SUV markets ie to make an SUV using Protons Platforms like the Iriz(P2platorm)and The Suprima (P1Platform)mostly for Asean and Indian markets …Remember that Peugeot are going to be in the Indian Markets so its already making a lot of sense
PSA would complement proton better compared to Geely. Geely have some euro 5 engines (which proton also developing) and chassis available for proton but apart from that nothing much. PSA have diesel engine, hybrid and design expertise which proton currently dont have.
“Geely sells roughly zero RHD cars…”
Throughout the article, only this statement caught my attention. If its zero (0), how can it be ‘roughly’….
xD
probably becoz they sold under 100 RHD cars per year… which is roughly 0% in market share?
Its fine if they mention %, but they didnt.
All the more reasons Geely is so interested in P1. P1 will be its foothold in SE Asia and manufacturing hub for RHD cars.
As of right now..my preference is like below;
1. Renault ; Renault+Nissan+Mitsubishi
Expert ; Sedan, Compact Hatchback, SUV, LCV
Market ; 3rd in Europe & Japan, Huge SEA base,
Branding; F1, Grand Tourismo, Rally, Electric
Reason ; Lack penetration in SEA (except for Mitsubishi)
2. PSA ; Peugeot+Citroen+DS Automoniles+Opel(maybe)
Expert ; Sedan, Compact, SUV, LCV
Market ; 2nd in Europe, Huge base in Africa, Middle East & China
Branding; Rally, Touring
Reason ; Lack penetration in Asia (except China)
3. Geely ; Geely+Volvo+London Taxi
Expert ; Sedan, SUV
Market ; Europe & China
Branding; Affordable, Safety
Reason ; Lack penetration in Asia (except China)
just my view….
Geely cars are not sellable in malaysia. it will make proton look worst. if the deal really happens between geely and proton, geely will giggle their way to the bank.
Hmmm… interesting thing that Geely is interested in Proton because of Lotus… doesn’t really need Proton products n manufacturing… still cheaper for them to manufacture in China.
On the other hand PSA is interested in Proton n its manufacturing facilities but not too keen on Lotus… decoupling Lotus from Proton might reduce the overall value n give new dynamics to the bids.
still not cheaper to import it from China into SEA region or even India.
DRB-Hicom is keeping their cards close to their chest, and rightfully so.
The deal has to consider more than just price, for sure. They will surely want the carmaker’s majority shareholder to move to PROTON City so that they can unlock the value of the Shah Alam land. The bidder will likely agree, but not immediately since they need to bump up demand. This works well for DRB-Hicom anyway since there is a glut in the property market at the moment. I think five years max and they will have Shah Alam plot for their own redevelopment.
It also makes sense for DRB-Hicom to carve out Lotus Cars from the deal. It will mean more cash value. If it is true one bidder does not want the sports car maker, but want’s the PROTON badge and the large facilities, this also works out well for DRB-Hicom; sell 51% equity to one without Lotus at a slightly cheaper price, then sell Lotus separately to the other bidder at more than the discount to the first bidder. Everyone is happy.
If I could choose, I would go with the French. Geely may be the better of the Chinese carmakers, but it is still China. Yes, I am using a broad brush here but there are things that have been proven about Chinese carmakers that is too large too ignore.
Did you forget Geely acquired Volvo while the Swedes were struggling? Geely injected much-needed capital into Volvo to make all their latest techs and models such as the XC90 possible. Nowadays, Volvo is improving and enjoyed record profit growth last year.
While everyone is puttimg in their 2 sen worth of comments, the person who is in the driver’s seat remains silent. What happened to the restructuring plans DS Idris Jala ?
Too busy having a good time after being made Chairman for Heineken Malaysia.?
Cheers mate !! Que Sera2x !!
restructuring plan is including this FSP fyi..
Holy Batman!
Better not have geely as the foreign partner because of this reason:
1)Geely is trying to be a copy or a fake of rolls royce like oppoo trying to be like apple product(gosh china,stop copying).
2)To me the design of geely doesn’t feel anything special like it doesn’t have a soul in it.
3)Expect a budget car from geely?way to dreamy!A company trying to be like rolls royce and giving a latest tech to proton is not likely to be cheap or budget because you can see how expensive volvo parts.
4)geely,only wanted lotus.so that’s make us doubt about proton future.
5)geely sells is not that impressive at all.
why we must have PSA as proton foreign partner:
1)They make a car with a lot of passion than geely.
2)Their designs is lively and had a soul in it.
3)Tech is also modern.
4)sells is quite impressive
5)More experience in car manufacture
6)it’s history is cool
7)focus in proton,that will likely give proton and malaysian a satifactory in future.Also,lotus can have more secure future.
preferred PSA more
Not many wants to visit workshop every week, wait for months for parts to arrive from France, and get heart attack inducing repair bills.
Safety first. Join forces with Geely and Volvo. Volvo uses Lexus gearbox, so they’re far more reliable than Frenchies.
Geely > all
Volvo > all
Proton is a natural born bloodsucker from day one till this day…….Be very careful with the investement…
Biasalah bang, ni kompeni Proton
Geely already has Volvo they don’t mind to acquire Lotus technology from DRB-HICOM instead of Proton. DRB-HICOM has to decide to continue pump million on to Lotus R&D & Marketing when Lotus P&L reported 40 Million Pounds loss last year.
Check from web info, Geely has exceeded > 100k vol in last month Jan sales figure, with Boyue model under supply badly, selling 20k per month but booking is crazy high. Check on the price of boyue, almost similar price range to HRV, but similar or slightly large size compare to CRV. CRV ? Yes CRV. Boyue spec is crazily plenty, with those features such as 360 camera, ACC, LDW, auto-parking, auto braking, fully leather, apple car play, voice control, countless airbag, 1.8T 184hp, auto this and auto that … put the CRV/HRV/apa-V into shame.
Their flagship sedan, GC9, even astonishing, selling at Altis price only in China … what a stealth. It’s branding is the only weakness.