Hindustan & Proton Malaysia On Car Assembling

By By: Vicky.in

Published: Tuesday, January 11, 2011, 17:08 [IST]

The ongoing labor strike in Hindustan Motors has not spared it from initiating negotiations with the Malaysian Proton Holdings Bhd. The talks are on now for drafting an agreement for manufacturing and assembling cars for the Indian car market. Some reliable sources of both the companies said a final decision may be aired sometime in February this year. Proton is likely to ask for employing HM"s Chennai plant, which is in charge of HM-Mitsubishi Lancer, so as to assemble Exora MUV. In addition there may be utility of HM"s other plants too such as in Uttarpara and Indore. In this connection top officials from Proton have made many visits to the HM plant in Chennai within the last three months. However, the initiative has centred around Exora MUV though Proton is seeking a larger sphere of operations in HM plants.

In particular, Proton is aiming for sourcing of transmission systems and engines from HM"s Avtec. The talk in the air has been confirmed by a director of Proton board(who had been the president of Hyundai previously), but with limited level of authority. Yet these sort of speculations are not advocated by the MD of Hindustan Motors who said such kind of information have been common in automobile business. He flatly refused to confirm such talks with Proton. For Proton"s part, its MD said that the group is keen on launching Saga, Exora, Emas and Persona in Indian market. To take advantage of the marketing strategy easily, the company lays more focus on local efficiency through any of the exiting giants. He said a concrete picture would evolve during the Q1 of 2011. Proton"s initiative is not a new one as it has been on the move for more than a decade now with so many local players. Among the noted ones are Hero Honda and M&M. The director"s earlier venture Argentum Motors too was approached but Proton could not succeed in bidding any of these companies.

In a bid to save time and money from erecting its own plant, Proton is looking for the current set up from the local company. Proton"s global activity spins around some European partner for getting necessary support for diesel engines. The most sought after company in this regard is Renault and Proton is fully aware of the increasing demand for diesel vehicles in Indian market as well.

Article Published On: Tuesday, January 11, 2011, 17:00 [IST]

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