Proton shares dive after talks fail

Malaysian government abandons talks to find partner for troubled national carmaker.

    The government said Proton will go it alone after showing promising sales and expansion plans [EPA]

    The announcement caught analysts by surprise and brought ratings downgrades for Proton stock as questions grew over the long-term viability of loss-making automaker.

     

    Lobbying

     

    Talks were called off after intense lobbying by Proton's management who wanted a chance to turn the company around, as well as some of Proton's rivals, according to a source familiar with the talks told Reuters.

     

    Rival firms had feared a Volkswagen-Proton alliance would usher in fierce new competition into the Malaysian domestic market.

     

    Explaining the decision to terminate talks with potential partners, Nor Mohamed Yakcop, Malaysia's second finance minister, said the government felt Proton should be given a chance to return to profitability on its own steam.

     

    He said the company had shown strong sales of its latest model and had plans to export to Iran and China.

     

    The government has been in on-and-off talks since 2004 with VW over a possible alliance, hoping to repeat the success Europe's biggest carmaker brought to Czech carmaker Skoda Auto.

    SOURCE: Agencies


    YOU MIGHT ALSO LIKE

    'We will cut your throats': The anatomy of Greece's lynch mobs

    The brutality of Greece's racist lynch mobs

    With anti-migrant violence hitting a fever pitch, victims ask why Greek authorities have carried out so few arrests.

    The rise of Pakistan's 'burger' generation

    The rise of Pakistan's 'burger' generation

    How a homegrown burger joint pioneered a food revolution and decades later gave a young, politicised class its identity.

    From Cameroon to US-Mexico border: 'We saw corpses along the way'

    'We saw corpses along the way'

    Kombo Yannick is one of the many African asylum seekers braving the longer Latin America route to the US.