KUALA LUMPUR, Feb 3 — German car maker Volkswagen (VW) is in talks with DRB-Hicom to take over some manufacturing capacity at Proton’s modern but underused plant in Tanjung Malim, Perak, and make Malaysia its regional production hub.
In return, it would help the local car manufacturer, which recently bought a controlling stake in Proton Holdings Bhd (Proton), make the brand more globally competitive through its engineering network and experience in emerging fast-growing markets such as China and Brazil, according to the Wall Street Journal (WSJ).
The international daily reported yesterday that several high-ranking VW executives from Germany had travelled here to talk directly with DRB-Hicom on how the two car makers could expand their business relationship.
“Volkswagen is constantly looking for growth opportunities worldwide,” WSJ quoted a VW spokesman as saying. No decision had been taken on its potential regional growth here, he added.
DRB-Hicom group managing director Datuk Seri Mohamad Khamil Jamil was last month reported as saying that the company was in “exploratory talks” with several partners for a tie-in involving Proton.
His comments came after Khazanah Nasional announced it was selling its 43 per cent share in the national car maker to DRB-Hicom for about RM1.3 billion.
VW is the world’s second-largest car maker after the US-based General Motors, and has been in talks with Malaysian tycoon Tan Sri Mokhtar al-Bukhary’s motor group for several years, but their proposals never really took off, the paper said.
WSJ noted a 2010 agreement between VW and DRB-Hicom to assemble cars in Malaysia, but added that DRB-Hicom also assembled and distributed vehicles for Daimler AG’s Mercedes-Benz and Japanese-owned motors Honda, Isuzu and Suzuki.
Proton, the newspaper said, had lost its dominant control in Malaysia lately owing to increasing competition at home.
It further noted that Malaysia had lowered some import barriers mandated by a Southeast Asian free-trade deal, paving the way for foreign manufacturers to enter one of the region’s largest car markets.
