After selling Proton

The recent movements of Proton's shares send many speculating that the national car manufacturer could have had a new buyer.

This is not the second time, nor the third time that someone has shown any interest in acquiring Proton. From Volkswagen to GM, Mitsubishi to Peugeot, along with some local consortia, but nothing comes under the hammer as yet.

Proton's biggest shareholder Khazanah has on numerous occasions held talks with major oversea automakers to dispose of Proton or forge a strategic alliance, and when everything was almost decided, Mahathir suddenly voiced up against the deal, followed by theories such as "national assets are not for sale," or "national interests must never be betrayed."

Khazanah did not want to offend Mahathir, the founding father of Proton, and had to continue adopting Proton out of no choice.

But this time, the sale of Proton could be real.

It was from the mouth of Mahathir himself that Proton would be sold to DRB-Hicom, a company run by renowned bumi entrepreneur Syed Mokhtar.

Well, now that Mahathir has given the green light, Proton will be able to get a buyer pretty soon. Khazanah can now get rid of this losing business, which is a good thing for both the government as well as the people.

The question is: Does Proton get the right buyer?

Sure enough DRB-Hicom is involved in automobiles, but given its size and experience which is restricted to solely vehicle assembly and marketing, it doesn't quite has what it takes to get into serious auto manufacturing.

Can the technology, capital, market and management expertise Proton needs so badly be available through DRB-Hicom?

I'm not sure about this, but it probably does have some plans in the pipeline!?

Proton's problems and future are an epitome of the fierce competition in the global auto industry. On the one hand we see large old-time manufacturers face to face with gruesome difficulty and some newcomers bowing out of the market; on the other hand we also see a handful of aspiring manufacturers rising above their peers.

An insightful article exploring the problems of the auto industry in the latest edition of Time magazine should serve as a good reference for Proton.

Several years ago, America's Big Three was having big trouble of surviving, with GM and Chrysler almost forced into bankruptcy. Many felt the American auto industry was not going to make it.

However, the US auto industry still survives today having gone past its darkest winter. The key lies in the effort of the US government to fix up the industry by not only providing the funds but also mapping out new development strategies for the industry.

It even pushed through a strategic alliance between Chrysler and Fiat, and allowed Italian Canadian Sergio Marchionne to take over the helm.

The US auto industry is now back on its feet. The government gets its investment returns, factory workers keep their jobs and the auto industry continues to become an important pillar of the US economy.

There is much more than just getting a new buyer for Proton!

-Sin Chew Daily/Asia News Network