China's plans bid for Malaysia's Proton

China's plans bid for Malaysia's Proton
Proton Suprima S by peysal (devian art)

China may soon cinch another knot in its business ties with Malaysia.

Zhejiang Geely Holding Group Co., the Chinese auto maker that owns Volvo Cars, is readying a bid for a majority stake in Malaysian car maker Proton Holdings Bhd., according to people familiar with the situation. France's PSA Group, which makes Peugeot and Citroën cars, said Tuesday that it has submitted a bid.

China's economic influence is growing in Malaysia, with a raft of deals in recent years. Geely executives recently visited Proton's offices in Malaysia, said one of the people familiar with the bidding process. Geely's public-relations manager, Ash Sutcliffe, declined to comment on Proton.

Proton owner DRB-Hicom Bhd. said earlier this month it expects to pick a foreign strategic partner for the unit in the first half of the year. The Malaysian automotive-to-defense conglomerate, controlled by Syed Mokhtar Al-Bukhary, didn't name the interested parties, though local press linked both PSA and fellow French maker Renault SA to Proton.

"Assuming control of Proton would make good strategic sense for Geely as a play for the Southeast Asian market," home to more than 630 million people, said Yale Zhang, managing director of Automotive Foresight. Cars built in any of the 10 members of the Association of Southeast Asian Nations can be sold throughout the bloc tariff-free.

While auto makers from Europe, Japan and the U.S. already have a strong presence in the region, Chinese makers have struggled overseas.

Proton was founded in the 1980s as a national industrial champion by a government eager to see Malaysia numbered among Asia's fast-growing "tiger" economies, such as Japan, South Korea and Singapore. With Kuala Lumpur's backing, Southeast Asia's only auto maker came to dominate its domestic market, but it struggled to produce a profit, and dreams of marketing the Proton regionally as the "Asean car" fizzled.

Still, it remains a symbol of national pride, and a sale to Geely would underscore China's growing economic clout in Malaysia, said Zhang Baohui of Hong Kong's Lingnan University.

"China is certainly gaining influence over Malaysia," said Mr. Zhang. "Its money is motivating Malaysia to redefine its China policy."

On a visit to Beijing in November, Prime Minister Najib Razak signed $34 billion of deals, including an order for four Chinese-built navy ships and a $12.3 billion high-speed railway line that Beijing will fund on favorable terms. A year earlier China had agreed to a $2.3 billion rescue package for 1MDB, Malaysia's scandal-hit government investment fund.

Proton cars | Eportfolio
Proton cars | Eportfolio


DRB-Hicom bought the Proton stake from Malaysia's sovereign-wealth fund, Khazanah Nasional Bhd., for about $412 million in 2012.

Sales at Proton, which also owns British sports- and racing-car brand Lotus, continue to decline as debt grows. The Malaysian government extended a $282 million bailout earlier this year on the condition that it bring in a foreign partner.


Source :

Write to Yantoultra Ngui at [email protected], Trefor Moss at [email protected] and Kane Wu at [email protected]

Tags: proton geely
Akhyari Hananto

I began my career in the banking industry in 1997, and stayed approx 6 years in it. This industry boost his knowledge about the economic condition in Indonesia, both macro and micro, and how to More understand it. My banking career continued in Yogyakarta when I joined in a program funded by the Asian Development Bank (ADB),as the coordinator for a program aimed to help improve the quality of learning and teaching process in private universities in Yogyakarta. When the earthquake stroke Yogyakarta, I chose to join an international NGO working in the area of ?disaster response and management, which allows me to help rebuild the city, as well as other disaster-stricken area in Indonesia. I went on to become the coordinator for emergency response in the Asia Pacific region. Then I was assigned for 1 year in Cambodia, as a country coordinator mostly to deliver developmental programs (water and sanitation, education, livelihood). In 2009, he continued his career as a protocol and HR officer at the U.S. Consulate General in Surabaya, and two years later I joined the Political and Economic Section until now, where i have to deal with extensive range of people and government officials, as well as private and government institution troughout eastern Indonesia. I am the founder and Editor-in-Chief in Good News From Indonesia (GNFI), a growing and influential social media movement, and was selected as one of The Most Influential Netizen 2011 by The Marketeers magazine. I also wrote a book on "Fundamentals of Disaster Management in 2007"?, "Good News From Indonesia : Beragam Prestasi Anak Bangsa di dunia"? which was luanched in August 2013, and "Indonesia Bersyukur"? which is launched in Sept 2013. In 2014, 3 books were released in which i was one of the writer; "Indonesia Pelangi Dunia"?, "Indonesia The Untold Stories"? and "Growing! Meretas Jalan Kejayaan" I give lectures to students in lectures nationwide, sharing on full range of issues, from economy, to diplomacy Less
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