TANJUNG MALIM: Proton Holdings Bhd, which is supplying Gen.2 cars to China-based Jinhua Youngman Automobile Group Ltd, is looking at exporting other models to the country in order to capture a larger market.
Head of China business Teo Aeng Kyet said Proton was negotiating with its Chinese partner to introduce different models in China.
“We have an agreement to supply 30,000 Gen.2 to Jinhua Youngman. We are also discussing with our partner to increase the order,” he told a media briefing prior to the second shipment of 348 Gen.2 to China yesterday.
“A total of 1,600 units of Gen.2 is scheduled to be shipped to China by end of next month in order to facilitate Jinhua Youngman’s sales launch programme in China,” he said.
Proton Gen.2 cars are shipped and re-badged as Eurostar in China. He added that Proton did some minor modification to the Gen.2 to suit the local market.
To date, Proton has shipped 408 of the 30,000 units ordered by Jinhua Youngman. Proton will continue to ship 1,500 units of Gen.2 monthly over the next 20 months to fulfil the order.
Proton and Jinhua Youngman, a leading commercial vehicle manufacturer in China with a licence to produce passenger cars, signed an agreement on July 13 under which Proton cars would be re-badged as “Europestar” in China.
Teo said for a start, Proton was selling completely built-up units to Jinhua Youngman.
“Subsequently, we will supply engines and completely knocked-down units (CKD) of several Proton models to Jinhua Youngman for assembly,” he said.
He added that the plant for Proton CKD was expected to begin operating in mid-2008.
Jinhua Youngman quality director Ma Wei Dong said the group had appointed 40 dealers in China to support the launch in January.
He said the group expected to double its sales of Proton cars in China in two to three years. However, Ma declined to elaborate as the negotiation between Jinhua Youngman and Proton was ongoing.
He said the company was confident of Proton cars as all 348 units of Gen.2 in the second shipment had been fully booked ahead of Chinese New Year in February.
“We will consider ordering more cars from Proton in the future. We are satisfied with the quality of the car,” he said adding that currently, car ownership in China is only about 1% of the population.
With the middle-income group expanding, spurred by economic growth that is expected to be above 8% annually, the car market is forecast to expand by 20% to 30% annually in the next few years.
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