Talks with VW and GM end without agreement; Proton will survive “for the time being.”
21 November 2007

Ailing Malaysian car-maker Proton has again failed to agree a partnership with either Volkswagen or General Motors, throwing the company’s future, which also owns UK sports car-maker and engineering outfit Lotus, into serious question.Proton has been looking for a western partner for two years now, to improve its technology and purchasing operations. Yesterday it announced that it had ended partnership talks with Volkswagen and General Motors, and although it’s not under immediate threat of closure, its long term prospects look bleak.Proton reported an £88 million loss in 2006, and although sales have picked up slightly during 2007, increased competition in its home market is expected to force it to adapt or die.The company is an attractive target for western car-makers because it still has around 40 per cent of the Malaysian car market, which itself is the biggest in south east Asia. However, any change in ownership of the outfit would not affect Lotus, as Autocar understands it, as control of the British firm is secured as part of a separate agreement with the Malaysian government.

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