According to second minister of international trade and industry Datuk Seri Ong Ka Chuan, Proton vendors need to cut prices by as much as 30%. The minister stated Proton CEO Li Chunrong has issued the ultimatum to parts suppliers, where failing to do so will result in the national camaker sourcing its parts elsewhere.

In a report by The Edge citing Nanyang Siang Pau, Ong pointed out Proton is buying automotive parts at a 30% premium from market price, and these costs will ultimately be borne by consumers. “Asking suppliers to cut prices could reduce Proton’s operating cost, which will enable consumer to enjoy affordable prices,” he said.

He added that once the necessary reforms are done, Proton would be able to properly execute its turnaround and offer affordable models of good quality. Ong also remained hopeful Proton would have more presence in international markets.

“Proton’s production has fallen from its peak of 200,000 unit to 70,000 units last year; the company lacks export strategy and only does domestic sales, so it can’t explore overseas markets,” Ong commented.

The minister also revealed Proton will close its Shah Alam plant in phases, and will completely move to Tanjung Malim by 2019. Production goals have been set at 200,000 units vehicles within its first five years and 400,000 units in 10 years, of which half of it will be catered for the export market.

“Thailand is producing 1.2 million vehicles every year; once Proton possessed advanced automotive technology, coupled with affordable prices, I believe having a 500,000-unit production is not an issue in future,” he said.