Chances Of Proton-VW Alliance 'Good', But GM's Still In The Race

[JoeT]

Chances Of Proton-VW Alliance 'Good'

Eileen Ng
26 June 2007
www.drive.com.au

Chances of an alliance between Malaysian national carmaker Proton and Germany's Volkswagen AG are "reasonably good", a cabinet minister said on Monday.

The two carmakers may hold a third round of negotiations, although no timetable is set for conclusion of the talks, Second Finance Minister Nor Mohamed Yakcop told reporters on the sidelines of an international economic conference in Singapore.

The fact that state-owned Proton and VW held their first round of talks in New York earlier this month and met again in Bangkok recently with the possibility of a third round "would almost by definition be a good news", he said.

"If it was bad, if it was not workable, we would have stopped at the first round," Nor Mohamed said, when asked about progress of the talks.

"The fact that we had a first round and a second round and a possible third round means that things are progressing, and the probability of working something out is reasonably good," he said.

The resumption of talks between Proton and VW marked a surprise turnaround after Malaysian Prime Minister Abdullah Ahmad Badawi said attempts to form a strategic alliance between the two had failed.

Nor Mohamed said the government, which holds a 43 per cent stake in Proton through its investment arm Khazanah Nasional, has not rejected General Motors Corp's proposal for a tie-up with Proton, although no negotiations were going on.

"GM's proposal is still on the table. We have not shut the door on any of them," he said

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GM & Proton Still Talking Weeks After Deadline

Stephanie Phang & Soraya Permatasari
21 May 2007
www.drive.com.au

General Motors, the largest US car maker, is still in talks about investing in unprofitable car maker Proton Holdings almost seven weeks after the Malaysian Government's deadline for a decision passed.

"GM is still interested and talks continue," spokesman Rob Leggat said in an emailed response to Bloomberg News questions. The talks are "preliminary", he added.

Proton spokeswoman Faridah Idris declined to comment.

Proton needs new technology and designs to compete, as it is losing market share to rivals including Toyota. Malaysia's Government, also in talks with Volkswagen, had aimed to pick a partner before April. It hasn't given a reason for the delay.

"The future of Proton will depend on a foreign partner, as it no longer has a competitive pricing edge," said Ang Kok Heng, of Phillip Capital Management, Kuala Lumpur. GM might "try to use Malaysia as a regional base" for exports, he said.

Volkswagen had "nothing new" to say about the negotiations, spokesman Andreas Meurer said in a mobile phone text message.

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Related Thread: Proton Still Seeking A Bigger Brother

[ARCANGEL]

Damn it just get lotus

[mike's 01ws6]

Originally Posted by ARCANGEL

Damn it just get lotus

Why, they got what they needed the first time around with them.

[mbukukanyau]

GM needs to aquirre Proton, get the production capacity, move quickly to turn tables on Toyota there, the way they did with Hyundai in korea using Daewoo

[SimonDavid]

Proton would be a nice to have, but what they really need is to get big in India - GM has a miniscule market share there in a country which is rivalling China in many ways

[chrisbenz]

Originally Posted by SimonDavid

Proton would be a nice to have, but what they really need is to get big in India - GM has a miniscule market share there in a country which is rivalling China in many ways

This is true. However, Fiat got its hands on Tata and what other brand is in India? They could use Proton to develop a line of cars that could be sold in India.

[Stéphane Dumas]

Originally Posted by chrisbenz

This is true. However, Fiat got its hands on Tata and what other brand is in India? They could use Proton to develop a line of cars that could be sold in India.

Agreed on this point

There Mahindra & Mahindra, who still built the Jeep CJ-3 under licence from Willys since the 1950s, however Mahindra signed an agreements with Renault to built Logan for the Indian market.

Hindustan, builder of the Ambassador, a Morris Oxford built under licence, also built once a 1970s Vauxhall model under licence, however it's also did an agreement with Mitsubishi.

Maruti, owned by Suzuki at around 50% (or 60% I'm not sure) and GM still own a small 3% of Suzuki, maybe we can use this small opportunity

[nadepalma]

I thought this was over and done with --- talks are still going on? This is news to me. I thought they wrapped up the deal with VW just as Winkerton was taking over. I hope GM gets them and uses them as an export base to flood South/South East Asia. We'll have to see.

Originally Posted by SimonDavid

Proton would be a nice to have, but what they really need is to get big in India - GM has a miniscule market share there in a country which is rivalling China in many ways

Originally Posted by chrisbenz

This is true. However, Fiat got its hands on Tata and what other brand is in India? They could use Proton to develop a line of cars that could be sold in India.

Both very good points of course --- the point about India is FAR overdue by GM. I give the credit for making some inroads lately, but honestly, if it weren't for the boom in China, they arguably would have been there by now.

As for Fiat, the deal with Tata is great for both sides. Tata is still independent, but they have agreed to sell Fiat cars in their showrooms and they also are going to develope a sub-$5000 car for the Indian market. If you're talking volume, this is where you need to be ---- to basically re-invent the Model T or the Cinquecento for the 21st Century.

I hope that GM picks up Proton -- let them use the brand in the ASEAN nations and they push rebranded models as Chevrolets for 3rd world nations and emerging markets. This move would also help alleviate some of the pressure on GMDAT to roll out units.

[kenman923]

Now GM is talking with Proton again. It would be nice if they could get some kind of deal going.

[Psionic Wibbly]

Oh gawd! not again; GM still has not given up its shopping addiction-shopping for failing brands-the desire to throw good money after bad and the even greater desire to get rid of things that are successful.

if you have something that is successful and profitable: get rid of it eg fiat, suzuki, subaru and isuzu

if it is failing or unprofitable buy it: eg saab: now proton.

once in a while it gets lucky as any gambler would eg DAT; but that only serves to increase its addiction!

[mbukukanyau]

Originally Posted by Psionic Wibbly

Oh gawd! not again; GM still has not given up its shopping addiction-shopping for failing brands-the desire to throw good money after bad and the even greater desire to get rid of things that are successful.

if you have something that is successful and profitable: get rid of it eg fiat, suzuki, subaru and isuzu

if it is failing or unprofitable buy it: eg saab: now proton.

once in a while it gets lucky as any gambler would eg DAT; but that only serves to increase its addiction!

U know their shopping addiction got them Daewoo
Have you test driven the 2008 Vue?

[SUPERBADD75]

i'm not sure i see where additional production capacity, more world market penetration, another foreign brand, and access to a more or less untouched market for GM (including Inda and surrounding countries) is a bad thing. i guess the only really dicey part is that Proton is controlled by Malaysian government, but if that can be overcome then this could be a boon for GM in south Asia. i love the idea, but don't know exactly how much politics could play into it.

[give_it_all_]

Maybe this is what GM is trying to get. I like the looks of this car. Even the interior is decent. So it looks to be good for an emerging market ie. India.
http://www.proton.co.uk/satria/index.asp

[Havasavana]

Take the money from selling Allison and buy Proton. Huh?

Does Toyota follow this model? Do they buy facilities from a failed company, slap a Toyota brand/model nameplate on a hurry-up product from the failed company and sell that as a Toyota? I'm afraid this Daewoo trip with Chevy nameplates is going to end badly as it won't compare well with Toyota's products. Poorly run companies can sell inferior products in a rapidly expanding market as we saw in the early days of the US market in the 20's and we're seeing in other parts of the world now. Over the longer term though, the best quality wins, just as it has and is here.

[chrisbenz]

Originally Posted by Havasavana

Take the money from selling Allison and buy Proton. Huh?

Does Toyota follow this model? Do they buy facilities from a failed company, slap a Toyota brand/model nameplate on a hurry-up product from the failed company and sell that as a Toyota? I'm afraid this Daewoo trip with Chevy nameplates is going to end badly as it won't compare well with Toyota's products. Poorly run companies can sell inferior products in a rapidly expanding market as we saw in the early days of the US market in the 20's and we're seeing in other parts of the world now. Over the longer term though, the best quality wins, just as it has and is here.

Isuzu Motors Ltd, Fuji Heavy Industries and Daihatsu.This companies are/were not doing good when Toyoda took then over.