KUALA LUMPUR: Proton, whose fortunes have been in stark contrast to that of rival Perodua, is poised to make a respectable comeback next year, following a slew of new launches in 2016.
In its turnaround effort, 2016 has been a very busy year for Proton as it introduced four new products to compete head on with other automakers in an intense market, while striving to regain the customers’ trust and confidence in the company and the brand.
Proton launched three new sedan models of the Perdana, Persona and Saga marques in June, August and September, respectively, while the Ertiga, a multi-purpose vehicle jointly developed with Suzuki, made its debut in November.
The Ertiga is the latest model from Proton.
Perodua, meanwhile, launched its first-ever sedan the Bezza in July, after 23 years of focusing on producing minicars.
Proton CEO Datuk Ahmad Fuaad Kenali said the carmaker, which was established in 1983, was set to make a comeback and it was confident of garnering a minimum 10,000 units monthly sales starting next year.
Total sales for 2016, however, were expected to be below the target as the buying momentum for the new models was just picking up, he said. By end-2016, he expects Proton to hit the maximum sales of 90,000 units.
“The delay in the launching of some of the models has affected the sales target for 2016. But with all the four products, we believe next year we should be able to achieve at least 10,000 sales per month, or 120,000 units for the whole of 2017.”
The carmaker collaborated with Petronas for an exclusive range of Petronas Syntium SE engine oils and streamlined the parts prices for more than 600 items in the second-half of 2016, to enable Proton customers enjoy better car performance and lower ownership cost in the long run.
It also expanded the “seven-day operations” at selected service centres to 27 outlets (as of December) in its efforts to provide flexibility, better customer service experience and improve after-sales services.
“The whole effort within Proton is now focusing on customers first,” said Ahmad Fuaad.
During the year, the national car maker also saw the resignation of its founder, former Prime Minister Tun Dr Mahathir Mohamad, as chairman effective March 31.
Nevertheless, the senior management of Proton will continue to pave the way towards a better future for the company.
The government in April 8, approved a RM1.5 billion soft loan to Proton to help rejuvenate the carmaker but, as one of the terms, it should immediately identify a strategic foreign partner to face the stiff competition from other automakers.
Proton’s holding company, DRB-Hicom Bhd, issued up to 1.25 billion new redeemable convertible cumulative preference shares (RCCPS) in June at RM1 each to Govco Holdings Bhd, 99.99 per cent-owned by the Ministry of Finance.
The Perdana.
The RM1.25 billion RCCPS is on top of the RM1.5 billion soft loan grant to recapitalise Proton for its transformation and restructuring.
Proton is now looking for a foreign partner that could provide a strategic, operational and cultural fit to grow its automotive business.
It has shortlisted the final three potential foreign strategic partners as at year-end, and according to Ahmad Fuaad, the three automakers had the criteria that could help Proton. The signing up of the partner is expected in May.
Meantime, 2016 has been a challenging year for the sector which prompted the Malaysian Automotive Association to drop the total industry volume (TIV) forecast to 580,000 units from 650,000 units in the second-half of 2016 amid the volatility in the global economy and soft consumer sentiment.
Market leader Perodua, which earlier maintained its total sales target this year at 216,000 units based on the projected demand for the Bezza, subsequently conceded in the fourth quarter that 2016 has been tough.
President and CEO Datuk Dr Aminar Rashid Salleh said Perodua had been gearing up its promotional activities in the final quarter of the year with three separate campaigns in its drive to end the year on a high note.
“This year is a tough year. We may end up with a slightly lower (figure) than our earlier sales target,” he said.
Bezza.
Axia.
Aminar expects 2017 to also be a challenging year especially in the first half, with sales picking up in the second half of the year.
“Cautiously positive, we will continue pushing all our four models, with Bezza and Axia leading the overall demand for 2017,” he added.
Continuously overtaking Proton in terms of TIV since 2009, Aminar led Perodua’s sales to hit a record high in 2015 with 213,300 units sold, as well as record high in market share (32 per cent) and in after-sales business (1.96 million intakes).
The Malaysia Automotive Institute (MAI) has laid out a roadmap until 2050 to ensure the country stay competitive by facilitating the development of technology in the domestic industry.
MAI CEO Datuk Madani Sahari said the newly-crafted National Automotive Roadmap 2050 to be presented to the government included the future of autonomous driving.
“The current National Automotive Policy 2014 roadmap is only up to 2030, and we came up with a new roadmap that would be inclusive for the automotive sector until 2050.
“Although the technologies are fast evolving in the automotive industry, our regulations and enforcement have yet to follow suit and this would also be contained in the new framework.”
Keyword: Proton confident of a comeback as 2017 looms