Dec 9, Though still a long way to go for Proton Holdings Bhd to be considered a successful carmaker in the world, it is albeit on the right track to be on par with the world’s top car manufacturers.
The national carmaker has proven its sceptics wrong by doing what it should do best, and that is the business of making and selling cars.
Launching of the highly-popular Proton Persona and the new Saga models has changed the company’s dwindling fortunes.
The company is now present in 24 countries including in the United Kingdom, Australia, New Zealand, Indonesia, Thailand and Singapore.
Analysts feel the company can double its overseas shipments to 40,000 units next year, aided by new models such as Persona, Saga and its latest edition, new multi-purpose vehicle, due for launch by March next year.
Currently, the company exports 2,000 units a month, working out to 24,000 units a year.
The crucial “ingredient” for its current success has been “offering the right car at the right time and at the right price.”
Credit should be given to managing director Datuk Syed Zainal Abidin Mohamed Tahir, who since taking over the helm in 2006, has been working tirelessly to push forward such a strategy that has thrust Proton on the right track to regain its share in the local and foreign automotive markets.
It was not too long ago when investors and analysts were apprehensive about the national car’s ability to be successful in overseas markets.
They said Proton might face a bumpy road ahead without a foreign partner for the popular thinking then that it needed a strong partner to survive in the long run.
The company had earlier negotiated for possible tie-ups with Volkswagen AG and General Motors Corp but they failed to materialise.
This episode aside, the national carmaker contended it could once again make operating profits on its own by selling more cars overseas, especially catering for the lower-cost segment.
This is what exactly the company is doing now. In the process, the company managed to return to the black in the financial year ended March 31, 2008, chalking up RM162.218 million in pre-tax profit from RM618.129 million in pre-tax losses.
Its revenue jumped to RM5.629 billion from RM4.912 billion. For the first six months ended Sept 30, 2008, Proton registered RM115.308 million in pre-tax profit from RM41.896 million in pre-tax losses in the same period last year due to a surge in domestic sales volume and higher margins, arising from better product mix and lower discounts.
As of October 2008, Proton’s market share is 33.3 percent, with a total of 122,351 units of registered cars in the country since January.
Domestic bookings for Persona have reached 59,028 units while Saga 91,127 units.
Given its current momentum, industry observers project that Proton will likely be profitable again this year due to growing market acceptance of its cars.
On the international business front, Proton is now actively exploring into new markets, not only to grow its export volumes, but also to derive income from the development and licensing of technology.
Syed Zainal concedes that it is a challenge for the company to sell cars in the overseas market but again the strategy of having the right car at the right time and at the right price, it can compete with other cars overseas.
“I think it will always be a challenge to sell cars in overseas markets but now we are confident because the cars we produce today is better designed and the quality has improved,” he said at the launch of Proton Persona and Gen.2 Facelift in Egypt recently.
“Our approach in overseas markets is by working with a strong local partner who has been in business for many years. The overseas market is competitive, but we believe there is an opportunity for us,” he said.
Syed Zainal said Proton will continue to focus on its strategy, concentrating on high-growth regional markets such as Asean, China, India and the Middle East North Africa (MENA) for economies of scale.
Recently, Proton launched the Persona models in Saudi Arabia and Egypt in a bid to strengthen its presence in the northen Africa and Middle Eastern markets.
Proton will be equally busy between December and at the end of January 2009 as more launches are expected, beginning with Oman, Qatar and lastly, Syria.
Proton introduced the Persona in Singapore and Indonesia in July and the Persona CNG in Thailand in October.
Source: Bernama By Mahanum Abdul Aziz