DRB-Hicom targets Proton's turnaround in five years

SHAH ALAM: DRB-Hicom Bhd, which named China national Li Chunrong as the new CEO for Proton Holding Bhd’s manufacturing arm Perusahaan Otomobil Nasional Sdn Bhd (PONSB), aims to turn around the loss-making national carmaker within the next five years.
"The first five years is the key. We want to turn (Proton) into profitability in the first five years. Certainly next year cannot be (profitable), but the third and fourth year is where we're looking to break even," DRB-Hicom group managing director Datuk Seri Syed Faisal Albar said at a media briefing here last Friday.
Proton finally secured China's Zhejiang Geely Holding Group Co as its foreign strategic partner in order to revive its business operation and the goal of becoming one of the top three carmakers in Asean within the next 10 years.
The first model that comes under the collaboration with Geely – Boyue – is expected to be launched in Malaysia by the end of 2018. Geely launched Boyue, a sports utility vehicle (SUV) under the C segment, back in March 2016, which is one of its best-selling models.
On why it takes so long before the launch, Syed Faisal explained that it is due to more time needed for the conversion from left-hand to right-hand drive.
"Besides that, we need to list down the details for the CKD (completely knocked-down) programme, it's not just about bringing the car in," he said, noting it generally takes three to four years to develop a car model.
Nonetheless, newly appointed PONSB CEO Chunrong said the group is planning to bring in a new car model every year after the launch of Boyue.
Chunrong’s appointment was made following the departure of Datuk Ahmad Fuaad Kenali on Sept 30.
"I was nominated by both DRB-Hicom and Geely to turn Proton around and I believe the Malaysian car brand will soon be the number one domestic brand and a leading Asean brand." he said.
Chunrong was Dongfeng Honda Engine Co deputy general manager prior to joining Geely. He has devoted his entire 30-year career to the automotive industry.
Syed Faisal explained that the appointment was not made at the Proton group level because the group wanted the management to “get closer” to its production unit.
At the Proton level, Syed Faisal remains the chairman and he is joined on the board by Shaharul Farez Hassan and Amalanathan Thomas as nominees from DRB-Hicom.
Meanwhile, China's Zhejiang Geely Holding Group Co Ltd has nominated its executive vice-president and CFO Daniel Donghui Li and Hong Kong-listed Geely Auto group vice-president and chief technology officer Feng Qing Feng as its nominees to the Proton board.
On a separate note, Donghui said Geely will provide all “necessary support” to Proton, including talent and resources sharing in research and development. “The key success is product itself, at the end we need the right products to satisfy the market requirements,” he added.
Nonetheless, Chunrong admitted that it will be a challenging time for Proton in the next 14 months as no new products will be launched, but he said sales can be improved through the fulfilment of customers’ satisfaction.
DRB-Hicom's share price was up three sen to RM1.63 last Friday, with some 3.4 million shares changing hands.