In Local News, Proton / By Mick Chan / 17 January 2019 1:34 pm / 32 comments

Following the first signing of the collaboration between Proton’s Malaysian vendors and their overseas counterparts, the Malaysian automaker has held a second exchange of collaboration agreements, which is set to bring an initial investment of RM47 million on top of the RM170 million in initial investment from the first agreement signed in October last year.

The collaboration agreements range from technical agreements and joint ventures to 100% foreign direct investments with overseas vendors investing directly into the Malaysian economy, and the sum invested is set to grow over the years in tandem with increases in Proton’s manufacturing volume, the company said.

The vendors involved will supply parts to Proton’s manufacturing facility in Tanjung Malim, which is currently undergoing a plant expansion and is expected to be complete soon. This will roll out the first CKD version of the Proton X70 in the second half of this year.

In this second batch there are seven foreign parties, of which are four joint ventures, one technical collaboration and two 100% foreign direct investments. The four JVs are with Liuzhou Shuangfei Auto Electric Appliances Manufacturing, HSHP Auto Technology, Ningbo Rocket Automobile Parts and Suzhou Prachtig Electronic Material. The two 100% FDIs are by Plastic Omnium China and Changzhou Tenglong Auto Parts, while the technical collaboration is with EcarX (Hubei) Technology.

“Proton’s vendor development programme is gathering pace and the company has worked hard on its matchmaking activities to find the best alliances that will benefit all vendors, the local economy and Proton as well. We are convinced that by building partnerships with overseas counterparts, it will be possible for local vendors to reach a world standard for technology advancement and quality in a short time frame,” said Proton CEO Li Chunrong.

“If our vendors achieve their targets, it will enable them to compete internationally, thus leading to the development of a vendor community that will allow the Malaysian automotive industry to compete on a global scale. The participation of these vendors is also vital to Proton’s long-term goals, which ultimately is to lead the industry to develop world-class competencies,” he added.

Though the agreement is for overseas vendors working with local vendors supplying for Proton vehicles, the reverse is also a possibility. If local vendors can meet the requirements of Geely in China for supply chains in that market, they can be considered for the China market as well, said Proton deputy CEO Datuk Radzaif Mohamed.