Proton - National Pride or White Elephant?

[misled_youth]

Proton bomb

May 6th 2004
From The Economist print edition

Malaysia's creaky national car company faces an uncertain future

NORWICH CITY has just won promotion to the Premier league, but things are not going so well for Proton, the Malaysian car firm that sponsors the English soccer team. Founded in the 1980s by Malaysia's then prime minister, Mahathir Mohamad, Proton was meant to symbolise the country's rapid industrialisation and aspirations to first-world status. Now, with free time since leaving office last October, Dr Mahathir is back, hoping to solve the problems of his cherished white elephant.

misled youth sez: 22 years to fix a mess. How much more time does Mr Beh needs?

Alas, his return led several Proton board members to threaten to resign. The row was only defused when Abdullah Badawi, the new prime minister, called an emergency board meeting of the government-controlled firm on April 17th. Ten days earlier, at another board meeting, Proton's largest shareholder, Khazanah, Malaysia's state investment company, failed to remove four directors, including the chief executive, Tengku Mahaleel
Ariff.

The mess in the boardroom reflects the mess on the ground.Despite its iconic national status, cheap prices and hefty tariffs imposed on rivals, last year Proton's domestic market share plunged from 49% to 38%, as sales fell by 28% to 155,000 cars. In the latest quarter, it posted a loss. Net profits for the year are expected to more than halve to 519m ringgit ($137m).

There is a reason why even patriotic Malaysians are paying 110,000 ringgit for a 1.6-litre Toyota or Honda when a similar-sized Proton costs less than 60,000 ringgit. The Wira, Proton's family saloon, is over a decade old and beset with faults. JD Powers, a consultancy, says that Proton has the worst quality record in the country.

A new saloon, the Gen.2, has fallen foul of supply bottlenecks and bad design. Since its launch in February fewer than 500 Gen.2s have been delivered. Insiders blame a shortage of engine cylinders, bought in from Australia. Dealers claim the waiting list is five months. Edward Ong, a car analyst at ING, believes ?at the current rate, it will be more like five years?. And the Gen.2's roof turns out to be too low for adults in the rear to sit comfortably.

Proton has always violated every principle of economics and car making. The Malaysian market is too small to offer the economies of scale needed by a global carmaker. So Dr Mahathir protected his baby with import duties of 40-300%. These kept Proton alive, but also uncompetitive. The firm has struggled to make good returns on the $2 billion cost of its two factories. Nor has it been allowed to lay off many workers to boost efficiency. Internationally, Proton sold just 8,000 cars in 2003 and its one overseas expansion?buying Britain's Lotus?brought only losses.

Under regional free-trade rules, Malaysia must cut import tariffs to as little as 5%?though it has managed to defer this until 2008 and to raise excise duties in some cases to 800%. Meanwhile, in March Mitsubishi ended its 20-year alliance with Proton, which bases its cars on the Japanese firm's designs.

That has led Khazanah to (reportedly) consider selling a 20% holding in Proton to a foreign carmaker. But any foreign firm would surely want control, in order to restructure Proton properly. Daewoo, the Korean unit of General Motors, may offer Proton an engineering collaboration. But most big carmakers already have operations in Thailand??the Detroit of Asia?. And with Dr Mahathir around, foreign investors may feel that Proton would be more trouble than it is worth. The government may want to find a partner for Proton fast, but Dr Mahathir is less keen, saying on April 30th that Proton was ?considering? offers from foreign car firms, but should be in no hurry to accept.

Proton represents all that was wrong with Dr Mahathir's Malaysia: a firm born of nationalist ideals not commercial rationale, protected by old- style cronyism and never exposed to real competition. Like its creator, the best thing may be to let it go gently into retirement.

----------------------------------------------------

Who then now b****?
________
Glass Bubbler (http://glassgallery.tumblr.com)

[weich]

hmm...if you've read all of economist's articles which relate to Malaysia, they always have a hint of negativity in them...

anyway, yup, i agree for now that Proton is kinda like a loss-making goverment linked company....but I think if Proton can survive the opening of the market due to AFTA, it can be a national pride =)

...its one overseas expansion buying Britain's Lotus brought only losses.

i think this sentence is not very accurate...what Lotus has brought to Proton is finally the much needed expertise in automotive engineering e.g. the Campro engine...and the improvements to Satria GTi's handling & chasis (revised anti-roll bar, springs, dampers, bushing, rack-and-pinion power steering, 16-inch alloy wheels), ....and finally brought local content in Proton cars to about 95%...

... the 20 or so years that Proton's 'cooperation' with Mitsubishi brought nothing but a reasonable and reliable engine...and only 70% local content....not much technology transfers....

..in fact, Lotus Engineering provides consultation services to other car makers, such as its owner Proton and ex-owner GM. In particular, GM relies heavily on it - the development of Ecotec engines and the handling tuning of Astra are conducted by Lotus instead of GM engineers. In the past decade, Lotus Engineering has grown a lot and became the largest contributor to the group profit.

..I would say wait 10 years before Lotus shows its worth! ..and this could be Proton's best investment...anyway, here's something to share about Lotus:

...In 2001, Lotus was in serious trouble. It had announced a ?43 million loss, it was having trouble getting its revised Elise into production, its deal with GM to build the VX220 (aka Opel Speedster) was in difficulty because it couldn't meet speed and quality targets, and it had publicly committed itself to a model between Elise and Esprit, code-named M250.

In support of these things it had built new factories and revised old ones, launched an expensive Elise racing series and upgraded its famous Hethel test track.

Since the ?43 million loss Lotus have improved operating profit by ?15-20 million, and they are now making money at the operating level. Their net profits aren't very good yet, because the company is still highly geared ? its borrowings and interest charges are too high. At worst, Lotus owed about ?80 million, but ever since Victor Khiam took over (the Proton executive i/c of Lotus) it is now more than halved that, and he has plans to reduce it more.'

Kiam's plan for Lotus, five years hence, is that it will be a company with a ?350 million turnover (?150 million now) with the earnings split two-to-one in favour of car production (at present it's about equal). By then Lotus should be producing 6000 cars a year in three models: 3000 Elise and Exige, 2000 Boxster-chasers; 1000 Esprits ? and about half of them targeted towards the US.

At that stage Lotus's shareholder (only Proton, since it acquired Romano Artioli's 20 per cent last year) will be getting what Kiam terms 'a proper return on its years of investment'. - edited from Autocar 2003

[The_Observer]

If you look at all the car companies in the world, try matching their history with our dear Proton's 22 years...they know cars better than Proton does. Proton was born in a bloody wrong time and going up against the wrong people. The Proton bubble is going to burst and it is not going to be pleasant, at least for some people. Just wait and see.

Besides, how many Proton cars are rip-offs of previous designs? Any car enthusiasts out there can point you the difference and similarities.

I agree about another thing. Proton money go into's Mahathir's family and friend's pockets. Not news for all of us, is it? LOL

[weich]

I agree about another thing. Proton money go into's Mahathir's family and friend's pockets. Not news for all of us, is it? LOL

woah...that's a big accusation...you should count yourself lucky Mahathir's not like LKY

[The_Observer]

Accusation???
I'm not accusing anybody...I'm just pointing out the facts...

To me, politicians who don't make money on the side while in power are fools. Problem in Malaysia is...these people overdid it.

[masterof_none]

so, what can we do now to fix the problem?.

read this thread first :
http://www.recom.org/modules.php?name=Forums&file=viewtopic&t=333&sid=b722ea1c4fbedd42d30ac3d19f4eaed4

[weich]

hmm...read thru' all 6 pages of that...

...maybe we should read this as well about Proton's Gen.2:

http://www.autoworld.com.my/emzine/review/viewarticle.asp?awReviewId=1593&awCatId=RT.ATC.CAR.PV

and this:

http://www.autoworld.com.my/emzine/review/viewarticle.asp?awReviewId=1594&awCatId=RT.ATC.CAR.BTW

...looks like we are going the right direction =) Common chasis design with the Waja and higher % of automation in the manufacturing processes, these are all cost cutting measures....

But then again, the results are not immediate, considering Gen.2's a new car....only a few months old, coupled with the 'wait and see' attitude adopted by many car buyers due to change in tariffs by the govt....we have to see how the results are in maybe a few more months to come...

special note about the development of the Campro engine, future versions will feature Lotus' patented Cam Profile Switching technology, which the Porsche VarioCam Plus system uses design elements licensed from.....which will definitely boost the power of the engine!!!

but here's my recommendations:

1. Adopt hybrid engine technologies (expensive I know....but possible with Lotus's help)
2. Open something like AMG - modify cars like crazy
3. Create a new niche - sportscar/family car - Lotus Elise with more space & comfort??? Expand on the MPV lines - M'sian families getting bigger now...
4. Focus on one area e.g. Volve = safety, Mercedes = class, etc
5. Hire a world class designer to boost European sales

hmm....anymore anyone else can think of?

[topdog]

woah...that's a big accusation...you should count yourself lucky Mahathir's not like LKY
are you sure?

anyways, thanks for the gen 2 review links.

[weich]

asked Chee Soon Juan what he got & also J.B. Jeyaretnam.....actually GCT also did it....but anyway....

...let's end this mindless accusations...what's the point?

back to how to make Proton better...haha :D

[topdog]

...let's end this mindless accusations...what's the point?
by mindless accusation i think you meant The_Observers comment about proton money going to mahathir's family and friends. that is just a harsh way of describing cronyism and nepotism, which i hope you are well aware were, and continue to be, part and parcel of the malaysian way.

back to how to make Proton better...haha :D
i agree, this thread is not the place to bash politicians. back to proton.

[morpheous]

proton issue..
here r morpheous's thoughts..
first, i think proton has done its good share in bringing richer lifestyle to an average msian family.
proton started off in when?correct me pls..1984 or 1985?now in 2004,we heard lots of complaints about proton cars. but these past 20 years or so, i believe proton has brought many good benefits to msians.proton played key roles in stimulating msia's domestic economies in 1980s and 1990s.
if not for proton, what will be the affordable imported car (japan,korea,european), that an average msian family man can fork out to buy?RM$60-80 K??would this be too expensive?more financial strain?how about money for children education?
proton prevented huge outflow of ringgit to foreign car manufacturers.

so, what can we do now to fix the problem?.
revamp proton's top management.
fix all those complaints, bottlenecks and design flaws.
get another engineering foreign partner.
reduce bumi 100% participation in top management to 60:40 or 70:30 which include foreigners/non-bumi participation.
put them (the foreign partners/non-bumi) in charge of design,technology development and production.

adopt power sharing policy as in BN?? :P
take your time..slowly the future bumi generations will slowly learn the rope about design, tech development and production..

[wwhong]

Accusation???
I'm not accusing anybody...I'm just pointing out the facts...

To me, politicians who don't make money on the side while in power are fools. Problem in Malaysia is...these people overdid it.

just curious...from where did u get those info from? please enlighten.

[Iceheart_Firebreath]

if not for proton, what will be the affordable imported car (japan,korea,european), that an average msian family man can fork out to buy?RM$60-80 K??

- morpheous


The fact that cars are expensive is largely due to the extremely high import tax placed by the Malaysian government to ENSURE people HAVE to buy Proton.

[Diesel]

imported cars used to be affordable before. now, they make us pay more that we should. the reason is, to protect the sales of national cars.

the problem is, they dont make good quality cars, at least in terms of safety. you know how weak a proton can be right? if you read the newspaper everyday, you'll see pictures of road accident involving protons, and usually, it's badly damaged, and the passengers often die. i heard for export, they make safer protons.

am i proud of proton, hell no. the govt make us pay more for low quality unsafe cars, and they make us pay too much for safer ones. they kill the people. they dont care about it, because they drive mercedes etc. at least if they drive protons, they'll have escorts to clear the way.

[The_Observer]

Dam, all the focus stuff (class, safety, fuel efficiency) all taken leh.
Like I say before, Proton born in wrong time and against the wrong people.
Probably only can compete in pricing. Do like what China does, copyright be damned, just make something and sell it cheap to gather a profit. Now isn't that business....and I am no expert in it :D

To weihong:
Where have you been for the last 2 decades? Please don't tell me you never heard of it or you think the Government is clean?

BTW, about the management thing. Yeah, I agree that it must have a revamp. Need to bring in the true professionals, foreign if needed.
For a country like Malaysia, Government control not good. For Singapore like that, probably can, easier for them because of size. You guys do know that Singaporean companies are usually Governement owned or partially owned? No such thing as privately owned there.

[misled_youth]

Anyone who has test drove a Subaru Impreza WRX would not give Proton a second look... The WRX is sooooooo sexy it gave me a boner.
________
California Dispensary (http://california.dispensaries.org/)

[Iceheart_Firebreath]

Yes, how horrible it is that Proton cars made for export are actually of better quality (and cheaper, I hear) than the ones here in Malaysia! Shame on them.

[Randomphantom]

Its cronyism rearing its ugly head again. Oh well, they reap what they sow.

Not only proton cars for export are of better quality(misleadingly), just compare their prices with local prices.

[Diesel]

back to how to make Proton better...haha :D
i agree, this thread is not the place to bash politicians. back to proton.[/quote]
no no, i say continue bashing politicians if we need to. come on, proton was established by mahathir, a politician.

[SpRInG]

back to how to make Proton better...haha :D
i agree, this thread is not the place to bash politicians. back to proton.
no no, i say continue bashing politicians if we need to. come on, proton was established by mahathir, a politician.[/quote]

that's the problem.... he thought he was a genius, a pioneer by establishing the proton industry... but it was one of his greatest mistakes in his whole carrier.. shame on him.....

but another thing is that, he should have admit that it was a mistake and repair the mistake, do somehting, stop it. He should not continuously use the ppl's money to continue to dump into the proton industry. If he had repented, he would have earned even more respect

[masterof_none]

no no, i say continue bashing politicians if we need to. come on, proton was established by mahathir, a politician.

already, there are a lot of people bashing politicians. I guess this is good enough.
Some people have to take part on actually try to improve the car.

again, like I said, we can bash around. But if we ourselves don't provide any suggestion on how to improve things (in this case, Proton), or even participate to improve it, how can the car can be better in the future?. (esp those who are engineers, you know better)

I cannot see why I should spend my energy criticizing govt, if , I myself don't do anything about it. If we criticize them,it's good to opinion on how to improve it.

If you think the Politics of Proton (the way they bid, etc) , or the govt. tactics of raising taxes is bad for Proton health, let's do some analysis on pro and cons of all these. That way, we can get a bigger picture.

[SpRInG]

hmm.. okay, but for me, i guess it would be better still if we sell proton... rather than keep throwing money into it.... if we sell it, we don't need to take care of extra expenditures, correct? Why must we have a national car at the first place? Reputation? Image?

Well, that sounds very justifying, but well, then the price is much too great for that, i think it is not suitable then. NO point of having a national car when the welfare of the whole nation has to be sacrificed. I say we just sell it, let those who really know how to deal with automobile industries do the job. We dont' lose anything actually.

[__earth]

that's the problem.... he thought he was a genius, a pioneer by establishing the proton industry... but it was one of his greatest mistakes in his whole carrier.. shame on him.....
IMO, it is wrong calling the creation of Proton a mistake. What is a mistake is Malaysia?s protective policy. I am sure that if this protective mentality is removed, Proton would move on to the greener side of the hill.

The price is bloodsucking yes. But Proton does provide social benefit to the society. Few instances are employment and the advancement of heavy industry. If you look back to the mid-eighties, Proton under HICOM was the first main player in heavy industry.

Also remember, Proton was the few things that jumpstarted Malaysian tiger economy that lasted well into 1997. Without Proton, I don?t see how Malaysian industry would have gone through what it had gone through.

Admittedly however, some matters like competitiveness need to be attended to. But again, once free trade in place, I am sure Proton will improve itself one way or another.

Problem in the present doesn't mean it a mistake in the past.
For example, take Mitsubishi. Mitsubishi is having problem right now and it is closing its plant in Australia. But does that mean the creation of Mitsubishi is a mistake? Do you dare calling Mitsubishi as a white elephant I ask you?

The creation of Proton was a good move by Mahathir, at least given the scenario of the 80s and considering its contribution to the economy in the past.

If you want to be critical of Mahathir, then you can call Perwaja as a mistake. But that's another story.

[USSDefiantNX74205]

I agree with __earth when he said we shouln't call Proton a failure. The failure here doesn't lie in the company, but with mismanagement, overprotection and political intervention. C'mon, if we are to create a competitive company, we have to expose them to competition. Perhaps giving Proton a jumpstart by giving them protection and a huge financial boost was the right thing to do considering that Proton was a late comer in this industry, but that protection should be stopped about five years after the establishment of the company. But it's still there, twenty years on. I say, revamp Proton completely. Give it a new image with new management, and hope the govt doesn't interfere this time. Let it be a real corporation that will get exposed to the ups and downs of the business world. Maybe then they'll learn something and buck up. Heck, if KIA could penetrate the American and Asian markets, I have no doubt Proton could do the same, if they are armed with a better range of cars and better management.

[topdog]

I cannot see why I should spend my energy criticizing govt, if , I myself don't do anything about it. yeah, especially when voters happily gave the same coalition a 90% majority.:D

but i digress.

back to proton - i am as outspoken a critic of mahathir and his megalomania as any, but i agree with previous posters' contention that proton should not be called a failure. after reading quite a bit about globalization, the free market, etc, i also have to agree with mahathirs dogged refusal to allow proton to be bought over by foreign carmakers.

i think the obvious first step towards creating a better image for proton would be for proton to stop treating its largest market like dirt. give us better quality cars and make all models conform to safety standards!

[el_empty]

Proton Australia defending Proton
http://www.malaysiakini.com/letters/33313

Aussie paper?s review of Proton Gen 2 atypical
Jon Thomson
Feb 2, 05 1:37pm

Just remember that Proton has only been building cars since 1987 and has only been designing its own cars for the past four years. It is the youngest car company in the world and is, by any measurement, the fastest developing car company in the world

Proton may be overprotected but it is developing complex machines in a very competitive global industry. On the way it is developing Malaysia?s skills base in manufacturing, engineering, research and development as well as a range of other necessary disciplines.

Only 11 countries in the world possess the necessary wherewithal to design and build motor cars and Malaysia is one of those countries. As I say, you have a lot to be proud of with Proton for it is a strong vibrant company that is eager to develop and grow and to produce cars that are a cut above the Koreans.


in response to:

http://www.malaysiakini.com/letters/33195
Aussie paper trashes Proton?s Gen 2
Marcus Falco
Jan 28, 05 2:54pm

Yep, Tengku Mahaleel won't be one happy camper - assuming he gets to read such reviews (most probably they would be carefully filtered by his minders) - nor would be those in the government who champion Proton as a national cause.
One can, of course, blame it on those ?bloody-minded Western journalists? who retain vestiges of their colonial mentality and refuse to see that good things can come from their former colonies. But I digress.

which referred to this australian article:
http://www.smh.com.au/news/Review-New/Proton-Gen-2-MLine/2005/01/10/1105582683001.html

For: Attractive price, refreshingly styled, good ride and handling, big boot.

Against: Awful quality, gutless and noisy engine, average refinement, unsupportive seats, dubious space and comfort for taller drivers, limited cabin storage.

Score: 1 star (out of 5)

The Gen 2 is not without its merits, but in the cold, hard light of day it is too poorly executed to use any of its strengths. And in a market full of thoroughly professional and capable alternatives, there's no way we can recommend it with a clear conscience.

[Thirdshifter]

how much more does a Gen2 cost over a Kia or hyundai in Oz?

There was recently a shakeup in the management of Proton, the chairman, Abu Hassan Kendut, resigned recently (apparently due to his rifts with Dr. M being an advisor to Proton).
http://www.forbes.com/work/feeds/ap/2005/02/04/ap1805330.html

More reports on this:
http://www.bloomberg.com/apps/news?pid=10000080&sid=aO6SapnadT7c&refer=asia

http://www.nst.com.my/Current_News/NST/Saturday/National/NST32234193.txt/Article/indexb_html

[masterof_none]

Great links Shien Jin.

I think the moral here is obvious.
Too much politics, then we have a quite messy top management.

I can feel that Proton is going down if this kind of thing continues.

[chenchow]

I am just curious right now, on how should Khazanah deal with this problem.

Tengku Mahallel is in friction with the Board of Director. Tengku Mahallel is instrumental in bringing the Proton connection with Volkswagen.

So, how you guys think Khazanah should deal with it?

[el_empty]

malaysia... are we losing behind again?

NZ unveils the Hulme F1, kiwi racecar. via screenshots/cyleow.

http://photoblog.jeffooi.com/cyleow/archives/Hulme04.jpg

[__earth]

damn interesting thing going on with Mahathir, Mahaleel and Rafidah.

Never thought Mahathir and Rafidah were such good friends.

[kucingbiru]

malaysia... are we losing behind again?

ah, forget about producing our own F1 car. they should focus on building safer cars for us.

[mita27]

POTONG Mediocrity has been drag on for too long (18yrs ) at the expense of Malaysia taxpayer's hard earned MONEY . I seriously think it's about time that our GOVERNMENT/OWNER ISSUES an ultimatum to the POTONG FACTORY -Significantly IMPROVE the quality IN 2 years or FACE the consequence of BEEN completely SHUT DOWN !!

:lol: :lol: not so seriously lah ...

[__earth]

From a redundant thread (http://www.recom.org/modules.php?name=Forums&file=posting&mode=quote&p=70924)

There were suggestions to close down proton. Pretty sad to hear itI wonder what fellow recommers think of these issue. Izit about economic and financial gains, or is it about the pride of our nation?
My personal opinion is that proton should not be closed down. Instead, more effort to improve their models should be put into it so that it can be on par with the other cars on the market.
What do you think?

why??

If u think that Proton should not be closed down because of national pride? How far do u think we should go? How much taxpayers' money do u think the government should put into the local car industry? How much protection should Proton (and other local car company) be given?

and problems about Proton... is it really that it is not on par with other cars because of not enough investment on it? or because of their unintelligent and unefficient way of using the money? or because of the 'slacky' "Malaysian" attitude that the workers are having...

of 2 out of 2 local cars that my family bought, both cars have minor problems (uncountable times) such as the wiring is not connected at all, the relay is loose... and the list goes on... am I the unlucky odd one out? or am I the majority?

furthermore, i wonder who decides the design of the car... to be dead honest, i have never seen an uglier car than Proton Juara... design and all doesn't cost all that much (i believe), as compared to a fail production where it had to be stopped after producing 3000 cars because nobody wants it...

i don't think money (lack of it) is the problem here, it is how to spend the money endowed is the huge problem... and another bigger problem is that they don't see the problem...

yes, I agree that proton cars have faults here and there, and I can say you r not the only one...the auto window of my family's wira jams once a while. And I also agree that Juara is a real failure...I do wonder how someone can come up with such a design and still market it.

I've heard of the government protecting proton...but how? Does the gov gives money to proton annually to finance its operations? Doesn't proton gain enough to finance itself? I've read in the papers that they even manage to build up their new factory with their own money. Isn't it true?

About, juara (and any other cars in the future) I think they should have done more research on the market and also the people's opnion on the cars before mass production..That way, they would not have wasted so much money.

[Zeroth]

Both my wira and my uncle's wira had faulty windows.

[vseehua]

from most of the proton (made for the local market that is) that i have met all these years, yea, i would say that the quality of the car is sorely lacking...the windows broke down and non-operational, the finishing leaves wide gaps for all to see etc etc etc...

i would say, the overprotection of the company is causing it to be overrelaxed in terms of the research and development department...churning out vehicles of this quality is definitely not the way to penetrate international market, which it saturated with very good cars already. what is needs is a outstanding design and be free from political influences..and of course a better management...

yea, i agree with some of you out there, proton is not the white elephant of the country, but the current management should be revamped with a more dynamic one and bring in more engineers so that the R & D department can start work immediately, we have a lot of capable mechanical and electronic engineers out there, i'm sure good ones are not hard to find :)...and please, stop copying other designs, we are NOT copycats...

[digimushu]

Actually it is not a matter of copying, since imitation is the sincerest form of flattery. However, it is a matter of copying BLINDLY until you even copy all the mistakes made in the original cars. Proton has grown well, for a young company without any foregn backing. You have to remember, american companies were helping out the koreans and the japanese. We were left to trade with whatever cards we got. Hence, i'm not surprised they are good at what the do. What proton should do, however, is analyze why they have RM130 million in losses and fix the problem.

[reedhus]

actually, proton did have help from foreign companies. in terms of design, it had help from mitsubishi and lotus, whether they knew it or not...(half the cars are blind rip offs)...then, engines also they got help. to be honest, proton is just too overconfident. they had the monopoly of the market until perodua came around. now, the myvi is doing so much better than the savvy. whose fault is that? i say proton shud not take malaysians for granted and try to come out with decent designs. the waja was great but the follow up was bad. (remember the aerodynamic juara?)

[weich]

from what i heard from a friend who has worked there before, the failures and all are due to contracts given out to 'favoured' ppl even when the quality is not as good...it all should be better when they just sack the whole senior management and replace them with capable ppl.

I think proton's designs and all are getting better now and they should continue doing it. It's not exactly a loss-making company so I see no reason to close it down.

[vseehua]

favourism have no place in any company...it's quality that should take precendance...

sigh...no wonder proton cn't improve better after all there years...

[digimushu]

actually, proton did have help from foreign companies. in terms of design, it had help from mitsubishi and lotus, whether they knew it or not...(half the cars are blind rip offs)...then, engines also they got help. to be honest, proton is just too overconfident. they had the monopoly of the market until perodua came around. now, the myvi is doing so much better than the savvy. whose fault is that? i say proton shud not take malaysians for granted and try to come out with decent designs. the waja was great but the follow up was bad. (remember the aerodynamic juara?)

Mitsubishi was not actually helping us, they were in a technology transfer agreement with Proton. GM and Ford was dishing out freebies to Daewoo and Hyundai.

[__earth]

a good read, even if you disagree with it.

taken from the comment section of jeff ooi's blog (http://www.jeffooi.com/archives/2005/12/protons_clearan.php).

The reason most of us make comments like the ones we do here saying 'we don't know why' is because we don't know why! If we were the type who had the capacity to make such decisions, we wouldn't be here! So, my advice is for everyone here to try to understand a decision first before hentam saja!

I consider Mahaleel to have known what he was doing because he was poached from 2 senior positions in 2 major Multinationals, Nestle and Shell, to be then Proton CEO. His CV prior to Proton speaks for itself and his performance in Proton have also not been faulted even by the people who removed him. In fact, the reason why he was removed was because he was so competent that the board of Proton, none of whom were Auto-Industry guys, couldn't control him!

I also found some of Dr M's decisions to be funny - like building PLUS (which now people claim is too small), the Penang Bridge (which now the gov wants to add to), KLIA (which now is beginning to get congested), F1 (which Lee Kuan Yew admitted to envying) and forcing Petronas to buy MISC (which now is the top performer on Bursa Malaysia - share splitting in a year when Bursa's total value shrank!). All these Dr M successes were criticised before, so I'd bite my tongue...

Augusta was bought I understood to get the small engine technology more than just the brand. The technology would allow Proton to avoid importing small engines like for the Savvy in the long term by designing its own. The deal was similar to the Lotus deal and buying this tech for Euro 70 Million without surrendering equity was a cheap deal for Proton!

And of course you have to buy a loss-making company to acquire such tech - it isn't possible or too expensive to buy into a profitable company or indeed to buy IP, if companies would sell it so openly in the first place! Purchases such as Augusta are sort of like loss-leaders in pursuit of an overall higher bottom line!

I am not suprised Proton's board now sold Augusta. This is because:

1 - The board has never understood the car business and how it is developed on the R&D side as well as the global outlook (e.g. they still want to sell cars in the UK when freight is killing our car prices??)

2 - The board can't realise Augusta's R&D value as most of the management and tech team nurturing the concept of Augusta as a tech provider left in disgust when Mahaleel's contract was not renewed, including the CFO and team who was disgusted at the accounting shenanigans the board wanted to put in place to sell off Proton assets like Augusta.

3 - The board is trying to pull an accounting fast one! Last quarter, they reported a loss because of Augusta loss provisions, now they can claim a 'profit' jump in the next quarter due to write-back on the provisions of these losses! What a scam! They're basically hiding the fact that Proton car sales have picked up since AP abuse and tax cheating were sorted out last quarter (covering MITI's culpability) and now will try to claim credit by this accounting trick!

I say the board is continuing its trend of trying to justify its existence with actions worthy of Arthur Anderson and Enron! Why else would the Proton CFO quit in disgust also when Mahaleel left?

So armchair critics, lets not be led by the Malaysian press of all people... look deeply and broadly and see the big picture!

[Thirdshifter]

What made perodua sucessful?

Well simple... very cheap unsafe vehicles.. even to protons standards.

While Myvi is the new generation from perodua i doubt it will overcome the great sucess kancil enjoyed during its first few years..

heck.. perodua is still selling kancil... even cheaper too.

[gonjeng]

well as far as the price is concern, proton cannot sell their car neither can they make their car cheaper/smaller than what is specified for them. basically, the government has draw the line that proton is to make cars from this size up (hence from this price up) and perodua is otherwise.

this is why perodua keeps on making small and hence, cheap cars while proton keeps on making medium sized cars. it is so happen that most ppl in malaysia do not have that much cash in hand to simply invest on cars. that is why kancil was selling pretty well...

[Maxforce]

Volume is not the only factor to the bottomline (net profit/loss)
Proton will have higher contribution per car (profit margin) compared to Perodua. Different market segment, different strategy required.
Oh yeah, I still think they should not have sacked Mahaleel, but thats my personal opinion.

[Thirdshifter]

Volume is not the only factor to the bottomline (net profit/loss)
Proton will have higher contribution per car (profit margin) compared to Perodua. Different market segment, different strategy required.
Oh yeah, I still think they should not have sacked Mahaleel, but thats my personal opinion.

Wow.. there's actually market segments for cheap national cars?

I think proton f-ked royally when they failed to produce a cheap compact car that is within kancils price.

Malaysia has a very slow and small market for cars. People are still driving their 1985 proton saga and i Kancil is going to be just like that.. MAlaysian never get rid of their cars.. as long as it jalan.. they'll keep it.

Kancils effect on proton is going to be worst and worst every year and i see proton folding very soon if they don;t beat the competition.

[deRame]

many said that proton cars have bad quality. however, i'm quite unsure how to classify the quality of a car. can anyone define for me what is a good quality car?


*digress*

see how jeremy clarkson treated a perodua kelisa

http://paultan.org/archives/2005/12/19/jeremy-clarkson-annihilates-the-perodua-kelisa/

[__earth]

proton *might* sell Lotus!

More:
1. Business Times (http://www.btimes.com.my/Current_News/BT/Thursday/Nation/20051229030341/Article/)
2. New Rating (http://www.newratings.com/analyst_news/article_1168136.html)

[ck]

Even in a Mercedes, you can still die in crash (poor Diana).

Anyway, I consider a good quality car when I do not need to send it for warranty issues... break light not working, door lock issue, gear box issue and etc.

As for crash safety... don't bother with Perodua cars... their metal (or aluminium?) are just too thin... you can even bent the bonet if u presses on it too hard.

Anyway, I would rather drive a car, compare to a bike. If I can afford Perodua... then so be it.

[Maxforce]

Volume is not the only factor to the bottomline (net profit/loss)
Proton will have higher contribution per car (profit margin) compared to Perodua. Different market segment, different strategy required.
Oh yeah, I still think they should not have sacked Mahaleel, but thats my personal opinion.

Wow.. there's actually market segments for cheap national cars?

I think proton f-ked royally when they failed to produce a cheap compact car that is within kancils price.

Malaysia has a very slow and small market for cars. People are still driving their 1985 proton saga and i Kancil is going to be just like that.. MAlaysian never get rid of their cars.. as long as it jalan.. they'll keep it.

Kancils effect on proton is going to be worst and worst every year and i see proton folding very soon if they don;t beat the competition.

There is actually.
Being from the auto related industry, I know some shit. :lol: :lol: :lol:
Kancil - The registration card says Capacity 5. But actually its more like 4. Boot (or is it hud? Whatever) space is limited.
Proton - If in terms of Iswara & Wira, it is a 5 seater. Boot space sufficient. MOre like Family kind of car and its cheap Family Car whereas Kancil is Cheap VERY Small Family Car/Startup Family Car (ie less teens more babies) :lol: :lol: :lol:
Satria/Putra: Cheap Fact Cars. In fact, Satria GTI's pickup speed is darn good, for the price you re paying.
MYVi - wannabe cheap car that would probably be a failure as its predecessor - Tiara.
Er, what else? Brain has turned into a mush.
Waja - Cheap luxury looking car - lousy seating and air cond configuration. Passenger gets no aircond :evil: :evil: But luxury looking. Gen 2 - Cool name, better design slightly than waja but BAD marketing move when using Gen 2 to market overseas. Gen 2 is supposed to mean 2nd Generation - National pride to new technology/advances. But who cares about Msian pride in overseas - assuming you re not targeting Msians overseas.

Market segmentation and product depth and category is the basic marketing and it works in real life. Simplest thing that has lotsa impact on sales and the bottomline. 8)

[masdie]

If you want to laugh at our M'sian cars, please watch the following videos:

- Jeremy Clarkson on the Proton Savvy (http://www.youtube.com/watch.php?v=J_UELomLm-A)

- Jeremy Clarkson Destroys Perodua Kelisa (http://www.youtube.com/watch.php?v=easZ2lhNOcs)

- Top Gear Crash Test Comparison (http://www.youtube.com/watch.php?v=MpwLGf5jWyY)

- Jeremy Clarkson and the Proton Gen2 (http://www.youtube.com/watch.php?v=Gi-4ni2vDBk)

[kintaro_kun]

lol!

really man, if you wanna save $ but not your life, buy a proton!

[__earth]

whoops. Not sure if this is a bad or a good news. Nonetheless, VW is not going to work with Proton (http://www.businessweek.com/ap/financialnews/D8F354J00.htm?campaign_id=apn_euro_up&chan=gb).

[Thirdshifter]

whoops. Not sure if this is a bad or a good news. Nonetheless, VW is not going to work with Proton (http://www.businessweek.com/ap/financialnews/D8F354J00.htm?campaign_id=apn_euro_up&chan=gb).

it's pretty much a nothing thing IMO.

As to good or Bad, i think it's good. Let proton die and finally we can open the car market fair and square.

It wouldn't hurt to have more automakes opening car factories in Malaysia and selling it real cheap to Malaysians. After all Proton is an overpriced piece of crap.

[el_empty]

As to good or Bad, i think it's good. Let proton die and finally we can open the car market fair and square.

but VW was planning to buy away proton, which literally means letting proton 'die' and become a foreign company (with a malaysian brand).

with this deal gone, proton will continue to become an afterdead, some sort of zombie. dead but won't go away. and it's going to cost taxpayers lots of money to keep the zombie ailve.

i think we just lost a valuable chance to remake proton, albeit under germans. again, thanks to narrow-minded political inteference.

[Thirdshifter]

As to good or Bad, i think it's good. Let proton die and finally we can open the car market fair and square.

but VW was planning to buy away proton, which literally means letting proton 'die' and become a foreign company (with a malaysian brand). .

They never planned to buy proton. All they really wanted was access to the proton plant to manufacture their car and on the side manufacture some proton.

They want protons assets but not the brand.

[el_empty]

As to good or Bad, i think it's good. Let proton die and finally we can open the car market fair and square.

but VW was planning to buy away proton, which literally means letting proton 'die' and become a foreign company (with a malaysian brand). .

They never planned to buy proton. All they really wanted was access to the proton plant to manufacture their car and on the side manufacture some proton.

They want protons assets but not the brand.

Really? I don't know the details, but why on earth would they do that? It seems so much more economical to get a license and build their own plant from the ground up than buying up the entire brand and trying to morph the proton components/machines/workers(!)/management/etc into volkswagenian products.

Not to mention, the guys at VW should have known that this venture hangs on a tenuous political thread and such whimsical plans to 'destroy' Proton will never materialize.