Proton and Geely

Looks like the rumours of Geely buying 49.9% of Proton is materialising. Proton is really in a financial rut and have no choice but to sell a large part to Geely. Dr. Mahathir the founder and creator of Proton is crying about it. Despite all this the current Malaysian Government is not willing to assist Proton any further. The relation between the present government and Dr. Mahathir is at its lowest which will literally accelerate the demise of Proton. Time and time again Proton has asked the Government for money and with so many prior financial injections there was no improvement made to the way Proton conducted business.

Proton has become a real burden to the Malaysian public. The original concept was good however with the way Dr. Mahathir handled business he only knew how to create protective business environment for Proton. It had an unfair advantage over competing car makers and this made them complacent over the years. Proton never improved itself and did not change its ways since the 1980s. Every other car maker has moved forward with product development and expanded well beyond their own shores.

When the news broke out that Proton would sell 49% to Geely and Dr. Mahathir was seen as a very unhappy person, the public was not sympathetic to him at all. In fact most Malaysians cursed him for creating Proton and forcing the public to buy cars at ridiculous prices and also creating the AP system that only enriched a few businessmen that were close to him. Seeing that the current turn of events have made Proton look like a useless company, everyone is waiting to see what will happen. Will Geely invest heavily to turn Proton around or will they eventually pull out. Geely for sure will not accept the way the current Proton management runs the business and they would want the corrupt management to be kicked out. Proton will also have to beg for money from Geely since the government will not be providing any more funding. Proton would have to listen to Geely's management if they want to have funds to keep running the business. Geely on the other hand will be able to expand into Malaysia and South East Asia very quickly.

The question in Malaysia is whether Malaysians will buy Geely cars since China made / China branded cars have not been well received. Geely's cars have improved tremendously in the last 10 years and ever since buying over Volvo, Geely has made big steps forward in terms of product development. Some technology transfer has naturally taken place and this can only benefit Geely. As an observer I do hope that the bulk of the corrupt Proton management will be kicked out once and for all. They have only contributed to the demise of the company and milked the company for all its got at the expense of Malaysian tax payers.