Proton manufactured close to 120,000 vehicles this year but only a dismal 20% of it was built for the export market. In the lightning pace of the automotive industry today, it is a small wonder why Proton is finding it hard to keep up overseas and increasingly in Malaysia as well. Product life cycles from other automakers are getting ever shorter to the extent that it feels as though carmakers are introducing a new model line-up virtually every year.
Compare this to Proton, whom only unveil on average 1 new model or model variant a year with great fanfare during the Merdeka period. This replacement rate simply won’t do for consumers who have grown accustomed to seeing fresh models in the forecourts of its competitors.
In fact, many of Proton’s own Middle Eastern distributors lamented the same when they gave up the business. While Toyota, Honda and the rest were springing models left and right, Proton’s languid pace with its boring facelifts and average replacement models fail to hold the buyers’ interest whom for now are prepared to stick with them thanks to the government’s absurd tax rate on non-Malaysian makes and not to mention its Pro-Proton NAP policies which Proton certainly had a hand in its implementation.
The dire situation of this slowdown is because Proton cannot afford to have it any faster. Not when its rate of returns is so low.Then there is the matter of price. In Malaysia, Proton prices are kept comparatively lower to foreign manufacturers through protectionism. This, unfortunately, is an advantage the company cannot count on in foreign markets.The Savvy, for instance, starts at RM 44,000 in the UK, which is one of the few markets that Proton exports its cars to. For that kind of money in the UK ,you can actually get a much better Kia Picanto and still be left wit a change of RM 12,000 to blow. Or if 1 decided to push it, they can even opt for the basic VW Polo which certainly is almost 4 times the car that the Savvy is.
With manufacturers pushing well into seven-figure production territory, Proton’s 108,405 does it no favours at all. Unable to generate the kind of volumes that any mass-market manufacturer needs to be viable, Proton cannot hope to match the scale that its competitors compete on
To have Proton address its dismal exports with urgency is to have it treat a symptom and not the problem. Exports are poor because the fundamentals of the company are poor. Its product replacement cycles are far too long for today’s market and it simply doesn’t have the kind of numbers to be able to match the prices the Koreans offer.
Before Proton can hope to get its exports up to where it needs to be, it will need to solve these problems first. And it is very unlikely that it will be able to do it alone. There may have been a time when it once was flushed with cash but this is no longer the case. A fiercely competitive market at home has made sure of that. All this thanks to the geniuses in Toyota and Honda whom came up with the City and the Vios and which has taken Proton and its substandard cars to the clothesline and hung them to dry.
No, to do this Proton will need a partner that can help shoulder the exorbitant costs of keeping up with the rest of the pack or to give it access to technology that’s already been developed. There’s no need to reinvent the wheel each and every time.
The Volkswagen tie-up seemed its best bet at the time but it chose to rebuff the protracted flirtations. Now, Volkswagen is busy with its own marriage to Porsche. And the rest of the big players in the world are also busy licking their own wounds.
Fresh from the economic crisis, Proton will have fewer healthy partners to choose from and it is itself no longer the jewel it once was. But the situation remains unchanged, then as now.
Without outside assistance, exports will be the least of Proton’s concerns.