Proton Holdings has terminated its joint venture (JV) contract with China’s Goldstar Heavy Industrial to build and market Lotus cars in China, The Edge reports. Lotus Group International, also a party in the equity venture, has also issued a termination letter to Goldstar. In April 2015, the parties signed an agreement to accelerate the development of Lotus cars in that market.

In a filing with Bursa Malaysia, DRB-Hicom said the contract was terminated because the JV company, Goldstar Lotus Automobile, had failed to obtain the required manufacturing licence in China in time. The deadline to obtain this was September 25 last year, but it was then extended by both parties to December 31, 2017.

The licence was still not obtained despite the extension, DRB-Hicom said. It added that the parties will consider and agree on the next course of action under the equity JV contract, in accordance with Chinese laws.

The new company was established with the aim of producing and selling Lotus-branded cars, engines, parts and components as well as accessories in the republic.

Lotus Cars is of course no longer owned by DRB-Hicom. In May last year the conglomerate announced it was selling off Lotus in its entirety, with the sale to be accomplished in two blocks. In September 2017 it was announced that Zhejiang Geely Holding (ZGH) had completed the transaction for a 51% majority stake in Lotus, with 49% being held by Malaysian automotive group Etika Automotive.