Survival Series – Proton Downsize While PM Waiting

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Apr 03 2007
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After Proton Edar Dealers’ Association (Peda) president Wan Ahmad Abdul Rahman cried that almost 70% if the 400 Proton dealers nationwide will be forced to close shop due to sluggish sale, Malaysian Prime Minister hinted that the dealers might be allowed to sell other cars as well to make ends meet.

Today, the Prime Minister confirmed that he’s waiting to meet German giant Volkswagen AG’s (FRA: VOW) chief. Just like what one of FinanceTwitter’s readers commented, it’s rather strange for a head of a country to meet a top official from a company over the fate of Proton. It shows how critical the Proton has reached in terms of its’ illness. Though it has been played down by certain politician (the deputy Prime Minister, Najib brushed off the dead-line as something which is not so vital), the anxiety shown by Badawi points to a different story altogether.

If only Badawi is not the Prime Minister, he could be flying all the way to Germany just to meet and beg Volkswagen to re-consider its’ decision to call-off the talk (though it has been denied that the talk was over). Due to protocol, the Volkswagen chief has no choice but to fly-in instead – though he’s taking his own sweet time to meet the premier.

The whole episode also shows how incapable of the local car manufacturer’s chief at the negotiation table. Proton clearly doesn’t have a capable and strong leader who can drive the company, not only from the business perspective but most importantly the negotiation skills to command the best deal possible for its’ own survival.

At almost the same time (today), Proton Holdings Bhd (KLSE: PROTON, stock-code, 5304) announced it is on track to downsize its network of dealers throughout the country by 20% by end-June. Its’ managing director Datuk Syed Zainal Syed Mohamed Tahir said Proton had made progress in the rationalisation of its dealers as part of initiatives rolled out to enhance the operational efficiency, cost competitiveness and value to customers – a very flowerish and jargon language which doesn’t actually tells the true picture of the real situation of Proton. What can you expect from such a high-level corporate figure who doesn’t take the initiative to understand the real pain of the company but confined within the four air-conditioned walls?

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I enjoy very much your comics/chart/graphics.

I will put you as one of the top 3 stock blogs for Malaysia.

You draw well and trade well. A hard to find combination.

thanx swifz … glad to hear you enjoy it … it’s one of my intentions to spread the knowledge/experience as far as possible so that everyone can learn (& hopefully share their unique experience gained throughout the years) and not slaughtered by the market makers …


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