Proton Predicts Better Performance in 2017

Malaysian national carmaker Proton Holdings, still searching auto dating sites for a malleable strategic partner, is confident of making a comeback in 2017.

CEO Ahmad Fuaad Kenali says Proton should sell a minimum of 10,000 vehicles per month next year, pointing to the launch of four new models as the first step in displacing competitors in Malaysia’s intense market.

The Perdana, Persona and Saga sedans were released in June, August and September, respectively, and the Ertiga multipurpose vehicle, jointly developed with Suzuki, hit the streets in November.

But Ahmad Fuaad tells the government’s Bernama news agency this year’s sales won’t reach target and are expected to total a maximum 90,000 units.

“The delay in the launching of some of the models has affected the sales target for 2016,” he tells the agency.

“But with all the four products, we believe next year we should be able to achieve at least 10,000 sales per month, or 120,000 units for the whole of 2017.”

Ahmad Fuaad says the whole effort within Proton is focusing on customers first, in part by expanding 7-day operation to 27 service centers.

Proton had to be bailed out in April with the Malaysian government giving it a 1.5-billion ringitt ($335 million) soft loan on the condition it immediately finds a strategic foreign partner.

The automaker also issued 1.25 billion new RM1 redeemable convertible cumulative preference shares to Govco Holdings, 99.99% owned by the Ministry of Finance.

Proton has a list of three potential foreign partners and Ahmad Fuaad tells Bernama they all have the criteria to push Proton to greater heights.

He expects to receive a complete proposal in February and announce the selected partner in the first quarter. There has been no announcement of how much of Proton the partner would hold, with everything on the table, including total ownership.

“There could be further negotiations prior to the conclusion, but hopefully a signing can be done by May 2017,” Ahmad Fuaad says.

Proton was privatized in 2010 and now is 100% owned by DRB-Hicom.

Its hunt for success comes at a time the Malaysian industry is facing tough times with sales in the first 11 months down 13.7% at 515,293 units.

The Malaysian Automotive Assn. has cut its 2016 sales forecast to 580,000 units from the record 666,674 in 2015, citing volatility in the global economy and soft consumer sentiment.

Market leader Perodua had a 2016 sales target of 216,000 units, but President and CEO Aminar Rashid Salleh says it’s been a tough year.

“We may end up with a slightly lower (figure) than our earlier sales target,” he tells Bernama.

Aminar expects 2017 to also be challenging, especially in the first half, with sales picking up in the final six months.