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The future ownership of Malaysian car-maker Proton has again been thrown into question, after it emerged earlier this week that talks between the Malaysian government and suitor Volkswagen have broken down.

Malaysian Prime Minister Datuk Seri Abdullah Haji Ahmad Badawi was quoted by state-run news agency Bernama as saying "I have decided, since Volkswagen is not interested in the proposal that Proton wants in terms of equity, Proton needs to talk to other people."

Back in March, autocar.co.uk picked up on a report in the Financial Times which claimed that VW was close to securing a majority stake in Proton, and by doing so, getting a larger foothold in the Asian car market.

The deal was also reported to be good news for Proton, whose market share has been shrinking, and whose losses have been mounting, since its home market was deregulated.

Of interest to UK car fans was the possibility that Proton-owned Lotus could have ended up under German control. It now looks as if that's unlikely, at least for the time being.

Now that VW is out of the picture, Proton will have to find a new partner with which to take its business forward – and it'll have to do so quickly. Most industry experts rate its operating losses high enough to bury the company before the end of the year, unless a new investor comes in.

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