The potential foreign partner is expected to be an automaker with a global brand.
The sale is being undertaken, says an exclusive report in the Nikkei Asian Review, as part of its restructuring. Proton is losing money.
Successful talks would mean the re-entry of foreign capital along with technology know-how for the first time since January 2005, when Mitsubishi Corp severed ties with Proton, said the report.
“We want a partner with an equity share in Proton,” Madani Sahari, the secretary of a task force to revive Proton, told the Nikkei Asian Review in a recent interview.
“There are a couple of interest[s] from global original equipment manufacturers, and it is being reviewed now by Proton,” he was quoted as saying.
Madani, who is also the chief executive of the Malaysian Automotive Institute, suggested that the potential foreign partner would be an automaker with a global brand.
The institute is an agency under the Ministry of International Trade and Industry to promote the automotive sector.
The New Straits Times last month quoted Madani as saying the Perodua model would be one worth emulating.
“The equity distribution between Perodua and Daihatsu at both holding and manufacturing levels is a good case study.
“The fair distribution has created a lot of trust and teamwork between the two entities, resulting in the market performance we’ve seen from Perodua for the past few years,” he was quoted as saying.
Perodua has a highly successful tie-up with Toyota Motor Corp’s unit Dahaitsu.
Proton is now collaborating with Honda Motor, building the Perdana executive sedan using an old Accord platform, and with Suzuki Motor on an upcoming model.
The Nikkei report quoted Madani as saying that Honda and Suzuki had the potential to become Proton’s partner as long as they had advanced engineering technology and capital.
It said analysts welcomed the injection of foreign capital into Proton, quoting Daniel Wong of Hong Leong Investment Bank as saying foreign-equity participation “will show the commitment through cash injection into a heavily indebted Proton.”
Proton, a unit of DRB Hicom, has been tasked with identifying a foreign partner within a year to assist in research and development in order to become a “competitive” automaker internationally in return for a soft loan of RM1.5 billion ringgit from the Government last month.
The money-losing carmaker also needs to submit a turnaround plan.
DRB Hicom logged a net loss of RM992 million for the fiscal year ended March 31, compared with the year-earlier RM300 million profit, said the Nikkei Asian Review report.
The company attributed the loss “largely to the poor performance of Proton,” with lower sales of motor vehicles.
Proton’s market share has eroded to 13 per cent from its peak in 1993, when Protons accounted for seven out every of 10 cars sold.
Besides restoring its market dominance, the government wants Proton to export cars with the aid of foreign partners.