Proton to turn around in one year

SHAH ALAM: Proton Holdings Bhd claims that its woes will be over in a year.
Newly-appointed managing director Syed Zainal Abidin Syed Mohamed Tahir has begun putting in place several initiatives that will help the national carmaker resolve its problems.
He expects that by the year, Proton will be cost effective, its quality issue fully-addressed and it will have a wider range of products to appeal to a broader market.
Proton is in a spot as it not only suffers from a perception issue on the quality of its cars and it is no longer profitable. It has under-utilised capacity and is selling mostly variants instead of bringing into the market new models to match those of its rivals.
It has not been able to align itself to a global automotive partner, a move which is necessary, given that markets would be liberalised. It is also not cost efficient.
Syed Zainal has a rough road ahead but he believes he will be able to deliver what is expected of him. He also needed Proton employees, vendors and distributors, to play their part too.
In his first media briefing after taking on the job since Jan 1, he said a strategic partnership was vital for Proton and it was in talks with several parties. However, he declined to name them.
“There are many players that have the right products that can serve Proton and its market. We have to look for parties that are willing to work with us.
“I am convinced there are still companies that are willing to talk to us and, when the time is right, we will make the announcement. But, we want to be selective in choosing the partners and it should be a win-win arrangement where we can get technology, models and expertise,’’ he said.
Syed Zainal was formerly from Perodua and he had dealt with Toyota and Daihatsu before joining Proton.
Proton, which has written to Volkswagen AG, expects a response within a week on whether the German carmaker was still interested to buy a stake in Proton. This is despite the fact that Volkswagen chief executive Bernd Pischetsrieder had recently indicated to analysts in the US that it was scrapping the earlier plans.
“We are still interested in forging a relationship with Volkswagen. We are hoping for a positive response from them,’’ Syed Zainal said.
Asked on talks with former partner Mitsubishi of Japan for an alliance in Proton, he said Proton had a relationship with the Japanese company that supplied parts.
“If there is a need to extend that relationship, we would look at it,’’ he said.
Going forward, he said Proton would be phasing out its Wira and Iswara models, but he did not say when.
A new range will be introduced only after careful and thorough surveys and evaluations have been done. One new model is slated for launch in April or May this year.
Besides that, he expects Proton to expand into other segments of the market. Proton also wants to enter the multi-purpose vehicle market which he said was the “fastest growing.’’
“We have two choices now, either remain in the same segments or move into newer ones. We prefer to go into newer markets and segments and, for the vehicles, we can forge alliances to supply the right models for the right market at the right price,’’ he said, without elaborating.
Proton will also revisit its plans to penetrate the China market and it will no longer ignore the Indian market.
These two markets offer huge growth potential and the entry could be via a strategic alliance with a local (Chinese or Indian) party or directly via a global automotive player.
For all that to happen, Proton’s house must be in order. That is why since taking the helm, he has been busy looking into how to improve the systems and processes at Proton as well as quality and costs.
On the cards is a revamp of the distribution network to achieve better utilisation of plants and ensure that vendors supplying parts to Proton are more quality conscious.

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