Business

Monday September 10, 2007

Light at the end of the tunnel for Proton

By DANNY YAP



PETALING JAYA: Securing a partnership with German auto giant Volkswagen is important for Proton’s survival, said a local analyst.

He said there now appeared to be light at the end of the tunnel, with Proton being hopeful of sealing the deal by year-end.

He noted that the Malaysian Government was also going all out to save the loss-making national car manufacturer by engaging in high-level talks with Volkswagen management.

The analyst said top government officials had expressed optimism that the deal could be worked out soon.

“The Volkswagen management in recent times has also expressed greater interest in wrapping up the deal,” he said.

He said Proton, while working on the Volkswagen deal, had not rested on its laurels and came out recently with a new car model, Persona, to stem its dwindling local market share (It went from a high of nearly a 60% share to slightly over 20% currently).

“The Persona, launched several weeks ago, was well received by car buyers,” he said, adding that Proton must come out with more “winning models” if it wanted to regain its market share locally.

Management said the Persona had received over 13,500 bookings locally to date.

The analyst said Proton’s tie-up with Volkswagen or an established car manufacturer was crucial to its ability to produce more new car models that were attractive and globally competitive.

“Proton needs an injection of foreign technical expertise to do this and it needs to do it fast,” he said, adding that new models must cater for local as well as global markets.

Last month, Proton announced it made a net loss of RM46.75mil in the first quarter ended June 30, 2007, making it the fifth consecutive quarter the national car maker had posted losses.

Proton’s top management plans to introduce a number of “variant models” next year.

 
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