Proton has expanding its presence in China with a new partner in Beijing-based Hawtai Motor Group Ltd.It is not a typical kind of joint venture as it is a cooperation that covers many areas.It also will help Proton to have an access to low-cost manufacturing in China. This is very important because 70 to 75 per cent of the cost of a car comes from its components.Read the full news by Hamisah Hamid from Btimes below.
PROTON INKS MoU WITH HAWTAI TO EXPAND PRESENCE IN CHINA.
NANNING (CHINA): Proton Holdings Bhd is expanding its market and gaining access to low-cost manufacturing in China by signing a memorandum of understanding (MoU) with Chinese carmaker Hawtai Motor Group Ltd.
The pact will include investment in product development to jointly come out with new models, through joint design and development cost sharing.
Chairman Datuk Seri Mohd Nadzmi Mohd Salleh said the MoU, which will turn into a definitive agreement within 90 days, may result in the setting up of a joint venture company.
Initially, Proton will license its current models to Beijing-based Hawtai Group to be manufactured at its plant for sale in China’s domestic market under the Hawtai brand, with possibility of co-naming with Proton.
Speaking to the Malaysian media after the signing of MoU witnessed by Prime Minister Datuk Seri Mohd Najib Razak here, yesterday, Nadzmi said Proton is considering a few models for manufacturing at Hawtai’s plant, which includes the Proton Exora MPV and a new model, which will be unveiled later.
“Both companies will also explore the development of new models together in later phase,” he added.
Proton group managing director Datuk Seri Syed Zainal Abidin Syed Mohamed Tahir said the joint venture company will also be responsible for vendor sourcing and component development work with local Chinese vendors.
This, he said will allow Proton to tap into the low cost base vendors in China and explore the potential of cross-supplying components from local Malaysian vendors to China and vice-versa.
The tie-up with Hawtai, which has an annual production capacity of 200,000 vehicles, 300,000 engines and 300,000 auto transmissions, will open up possibilities of Proton penetrating left-hand drive markets such as in the Middle-East.
“We can also incorporate Hawtai’s diesel technology in our cars and export them to India,” he said.
Proton will consider all areas in the joint product development.
“This will include looking into new models manufactured by Hawtai Group that are suitable to be re-developed to replace existing Proton models, with both companies sharing the development and tooling costs.”
On another development, he said Proton is willing to help carmakers in Thailand who are affected by floods.