Straits Times: “Malaysia’s Proton sale fuels debate: Counting on Geely to jump-start ailing firm”
Malaysian taxpayers have pumped more than U$3 billion (S$4.14 billion) over the last three decades into Proton to keep it afloat, and many hope that Chinese giant Zhejiang Geely’s planned purchase of 49.9 per cent of the company will mean they no longer have to subsidise the national carmaker.
Malaysian former prime minister Mahathir Mohamad has said that selling Proton is bad for the country, likening it to controversial land sales by the government which “forfeit our country; like we forfeit Proton”. “I am sure Proton will do well… but I cannot be proud of the success of something that does not belong to me or my country,” he wrote on Thursday. Tun Dr Mahathir has been critical of Prime Minister Najib Razak’s efforts to woo investors from China, accusing him of selling the country’s assets to reduce massive debts.
But this appeal to nationalism appears set to fall on deaf ears so long as Proton’s operations remain strong.
“If the new ownership structure does not translate into loss of jobs, then it will have little impact on Mr Najib politically,” Vriens & Partners’ political risk and government relations consultant Adib Zalkapli told The Sunday Times.
Under Proton, the British marque lacked the scale or investment needed to make it into a global sports brand, something that could change as part of a broader Volvo-Geely group.
Still, there’s a major difference between buying Volvo Cars and Proton, said Hong Kong-based consultancy Dunne Automotive president Michael Dunne. “With Volvo he inherited a talented corps of automotive executives and strong leaders. At Proton, Geely-Volvo will need to bring fresh energy and capabilities.”
Mr Li will also need to wring cost savings and integrate Proton into his Geely-Volvo set-up. “No matter the odds, (it’s) best to never ever bet against Li Shufu,” said Mr Dunne. “He has that golden touch, bundles of charm and incomparable tenacity.”
Said state-backed China Association of Automobile Manufacturers vice-chairman Dong Yang two weeks ago after touring Geely’s facilities in Ningbo, China: “Geely has evolved from an ugly duckling to a white swan.”
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