The conglomerate will focus on growing its automotive business with joint-venture partners Volkswagen and the UK's Potenza, says DRB-HICOM group managing director
Conglomerate DRB-HICOM Bhd (1619) has put its plans to take a stake in national carmaker Proton Holdings Bhd on the back burner for now.
Instead, it will focus on growing its automotive business with joint-venture (JV) partners Volkswagen AG (VW) and the UK's Potenza, group managing director Datuk Seri Mohd Khamil Jamil said.
He expects to ink a firm agreement with Germany's VW for the assembly of VW vehicles in Malaysia by the end of the year.
DRB-HICOM is also close to reaching an agreement with another Asian carmaker, he said, without providing details.
He hinted that this partnership may result in the production of a vehicle that DRB-HICOM "can call our own".
"The Proton issue, I think that is a thing of the past for the time being. That is something which may not be within our radar in the short term," Mohd Khamil told reporters after the group's annual general meeting in Shah Alam, Selangor, yesterday.
DRB-HICOM remains open to taking a stake in Proton if the opportunity arises, he said, but indicated that this was not something it would pursue this year or the next.
The group, however, continues to work with Proton and stands to benefit if the latter does well. It is one of the main suppliers of parts to Proton as well as a distributor of its products, he pointed out.
It was reported a year ago that DRB-HICOM had put in a bid to buy a 32 per cent stake in Proton. Mohd Khamil yesterday denied having ever put in an official bid.
"We put in something, yes, but it wasn't anything official," he claimed.
The fact that it isn't going for the stake now "is a greater loss for Proton than it is for DRB-HICOM", an automotive analyst from a local bank-backed brokerage said, noting that the VW venture would be significant for DRB-HICOM.
Proton itself had twice tried to rope in VW as its foreign partner, but both parties failed to agree on terms.
Mohd Khamil said the first rollout of VW products at DRB-HICOM's plant in Pekan, Pahang, can be expected sometime towards the end of next year.
He said it is likely to come up with three models of VW cars - analysts believe these may be the Golf, Beetle and Passat - and produce 30,000 units a year by 2015.
The company is now "in the final leg of negotiations" with VW on these plans, Mohd Khamil added. This follows an initial agreement that it had inked with the European number one carmaker last month.
Earlier this month, it firmed a plan with Potenza Sports Cars Ltd to build the British sports car marque for domestic and Asia-Pacific markets.
Mohd Khamil said the group expects to sell about 110,000 to 120,000 vehicles this year.
Instead, it will focus on growing its automotive business with joint-venture (JV) partners Volkswagen AG (VW) and the UK's Potenza, group managing director Datuk Seri Mohd Khamil Jamil said.
He expects to ink a firm agreement with Germany's VW for the assembly of VW vehicles in Malaysia by the end of the year.
DRB-HICOM is also close to reaching an agreement with another Asian carmaker, he said, without providing details.
He hinted that this partnership may result in the production of a vehicle that DRB-HICOM "can call our own".
"The Proton issue, I think that is a thing of the past for the time being. That is something which may not be within our radar in the short term," Mohd Khamil told reporters after the group's annual general meeting in Shah Alam, Selangor, yesterday.
DRB-HICOM remains open to taking a stake in Proton if the opportunity arises, he said, but indicated that this was not something it would pursue this year or the next.
The group, however, continues to work with Proton and stands to benefit if the latter does well. It is one of the main suppliers of parts to Proton as well as a distributor of its products, he pointed out.It was reported a year ago that DRB-HICOM had put in a bid to buy a 32 per cent stake in Proton. Mohd Khamil yesterday denied having ever put in an official bid.
"We put in something, yes, but it wasn't anything official," he claimed.
The fact that it isn't going for the stake now "is a greater loss for Proton than it is for DRB-HICOM", an automotive analyst from a local bank-backed brokerage said, noting that the VW venture would be significant for DRB-HICOM.
Proton itself had twice tried to rope in VW as its foreign partner, but both parties failed to agree on terms.
Mohd Khamil said the first rollout of VW products at DRB-HICOM's plant in Pekan, Pahang, can be expected sometime towards the end of next year.
He said it is likely to come up with three models of VW cars - analysts believe these may be the Golf, Beetle and Passat - and produce 30,000 units a year by 2015.
The company is now "in the final leg of negotiations" with VW on these plans, Mohd Khamil added. This follows an initial agreement that it had inked with the European number one carmaker last month.
Earlier this month, it firmed a plan with Potenza Sports Cars Ltd to build the British sports car marque for domestic and Asia-Pacific markets.
Mohd Khamil said the group expects to sell about 110,000 to 120,000 vehicles this year.
By Adeline Paul Raj
Business Times
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